NEW YORK (TheStreet) - Shares of Whole Foods Market (WFM) were plunging 7.5% to $51.27 after reporting disappointing firsts-quarter results last night that spooked investors.
The organic and specialty foods store said late Wednesday it earned a profit of $158 million, or 42 cents a share for its fiscal first quarter ending Jan. 19, compared to consensus estimates of 44 cents a share.
Revenue also came in light at $4.24 billion, up 10% from the year-earlier quarter, compared to the $4.29 billion expected by analysts, according to Thomson Reuters.
Whole Foods' miss on both profit and revenue estimates, as well as store comparable sales growth, further fueled Wall Street's thesis that Whole Foods is having a tough time against competition. It's likely that the rough winter is also hurting traffic and sales.
Same store sales grew 5.4%, last year's 7.2% growth, and below Wall Street's forecast.
On top of that the company tightened (and lowered) its 2014 outlook for sales and earnings.
TheStreet's Jim Cramer makes a great case for the stock in his Real Money article this morning, in which he said: "Ultimately, had the analysts not raised expectations with their recent pushes, this stock would barely be hit. But they did raise those expectations and now we have the damage that simply must occur."
"So, I think the stock marks time here until we know more. It remains a terrific growth company, just not as terrific as it was. So, shareholders have to pay the price, the reduced price, for the reduced earnings where it's neither here nor there short term, but deserves a better price long term simply because I believe that the quarter represents a trough decline and there won't be another cut expected," Cramer said.