Whole Foods (WFMI) hits new low After-Hours

Whole Foods Market, Inc. (NASDAQ:WFMI) hit $18.99 after-hours today which takes it to a new 52-week low. Q3 08 net income fell 30% and the 2009 outlook is even worse, now expecting sales growth of 6 to 10% for the year not the previously stated 25 to 30% growth.  Ouch.

To add to the pain for shareholders, Whole Foods suspended its dividend. Yet they reported revenue of $1.84 billion for the quarter, up from $1.51 billion in the previous year.

The results fell short of Wall Street's expectations, as analysts polled by Thomson Financial had expected a profit of 31 cents per share on revenue of $1.9 billion.

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Whole Foods also sharply cut its outlook for 2009, saying it now expects sales growth of 6 percent to 10 percent for the year — rather than the previously stated 25 percent to 30 percent growth. And it said its comparable-store sales are expected to grow 1 percent to 5 percent, down from the previously anticipated growth of 7.5 percent to 9.5 percent.

The company said it plans to update its guidance in November.  Maybe that will help the chart?

Whole Foods also said it is taking some cost-cutting steps as part of a more "conservative approach," such as reducing the number of stores it plans to open in 2009 and suspending its quarterly dividend for the foreseeable future.

"We remain very bullish on our growth prospects as the market for natural and organic products continues to grow and our company continues to evolve," CEO Jeff Mackey said. "However, the challenging economic environment appears to be negatively impacting our sales."

The analyst reaction is on the money:

Results "are not good," said Edward Jones analyst Stephanie Hoff, who said comparable-store sales growth for the fiscal third quarter was also short of expectations.

"You have a company that used to post above the main-line grocery stores now posting more in-line with grocery, so I think that's suggesting a share shift," she added.

Masters, without the dividend combined with the guidance and state of the U.S. economy, shares of WFMI could get even cheaper.  With so many factors working against Whole Food shares, we are forced to give it the 1-2-shaba-stop-already

SOURCE: http://www.sun-sentinel.com/business/nationworld/ats-ap-earns-whole-foodsaug05,0,2882909.story