Sprouts Farmers Market Expected to Show Strong Q2 Results

Sprouts Farmers Market is expected to show strong Q2 results, according to RBC. The specialty natural and organic food retailer offers a wide range of products, including fresh produce, meat and seafood, deli, bakery, and frozen foods. With over 407 stores in 23 states, Sprouts Farmers Market differentiates itself through its open layout and focus on fresh, natural, and organic foods.

Sprouts Farmers Market (SFM) is poised to report strong second-quarter (Q2) results, according to RBC Capital. The specialty natural and organic food retailer, with over 407 stores in 23 states, is expected to meet investor expectations after missing elevated buy-side bars in the past two quarters. RBC Capital analyst Steven Shemesh raised the firm’s price target on SFM to $173 from $172, maintaining a Sector Perform rating ahead of the Q2 earnings report [1].

The analyst noted that expectations for SFM are "much more reasonable," creating a "decent setup" heading into the earnings report. Shemesh cited a 15% forecast for second-quarter net sales growth, driven by same-store sales growth of 8.5% and 13 new store openings. This growth aligns with the company’s strong track record, as trailing twelve-month revenue growth stands at 15.51% and the Financial Health Score is GREAT [2].

Additionally, RBC Capital projects approximately 85 basis points of operating margin expansion for the quarter, exceeding Sprouts’ guidance of 60 basis points. The firm increased its second-quarter adjusted earnings per share estimate to $1.27, up from its previous forecast of $1.23. The company’s strategic initiatives, including the introduction of a new loyalty program and a shift to self-distribution for meat and seafood, are expected to further boost sales and improve margins [2].

Sprouts Farmers Market reported strong financial results for Q1 2025, with earnings per share (EPS) of $1.81, surpassing the forecasted $1.54. Revenue for the quarter reached $2.2 billion, marking a 19% increase year-over-year. CFRA analyst Arun Sundaram upgraded SFM shares to Buy, raising the price target to $205, citing the company’s robust margin expansion and potential for new store openings [2].

In other recent news, Simply Good Foods reported a 13.8% increase in net sales for Q3 2025, driven by the acquisition of OWYN and approximately 4% organic growth. Quest, representing about 60% of net sales, saw 15% growth in Q3, while Atkins declined 12.7%. The company expects total company reported net sales to increase 8.5% to 9.5% for the full year, with organic net sales growth mainly from volume [3].

References:
[1] https://www.tipranks.com/news/the-fly/sprouts-farmers-market-price-target-raised-to-173-from-172-at-rbc-capital-thefly
[2] https://www.investing.com/news/analyst-ratings/sprouts-farmers-market-price-target-raised-to-173-from-172-at-rbc-capital-93CH-4136160
[3] https://seekingalpha.com/news/4466600-simply-good-foods-signals-3-percent-organic-sales-growth-and-mid-single-digit-ebitda-increase