What Happened?
Shares of grocery store chain Sprouts Farmers Market (NASDAQ: SFM) jumped 4.2% in the morning session after it maintained its positive momentum as RBC Capital upgraded the stock's rating from "Sector Perform" to "Outperform."
The investment firm noted that Sprouts' shares had declined approximately 42% since their peak in June, and stated its belief that concerns about the company's recent promotional activity were "overblown." While the firm adjusted its price target down to $148 from $176, the new target still represented significant potential upside from the trading price at the time. RBC Capital also projected that Sprouts could achieve low double-digit revenue growth and low to mid-teens earnings per share growth over the medium term.
After the initial pop the shares cooled down to $110.69, up 3.8% from previous close.
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What Is The Market Telling Us
Sprouts’s shares are not very volatile and have only had 8 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was about 23 hours ago when the stock gained 4.3% on the news that RBC Capital upgraded the stock from "Sector Perform" to "Outperform".
Sprouts is down 16.7% since the beginning of the year, and at $110.69 per share, it is trading 38.3% below its 52-week high of $179.53 from June 2025. Investors who bought $1,000 worth of Sprouts’s shares 5 years ago would now be looking at an investment worth $5,110.
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