Why The Fresh Market (TFM) Stock Is Up Today

NEW YORK (TheStreet) -- The Fresh Market (TFM) was gaining 4% to $29.83 Friday after beating analysts' estimates for revenue in the first quarter.

For the first quarter, The Fresh Market reported earnings of 43 cents a share, in-line with estimates from analysts surveyed by Thomson Reuters. Revenue grew 17.6% from the year-ago quarter to $431 million. Analysts expected revenue of $419.85 million.

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Looking forward to the full-year 2014 The Fresh Market expects EPS of $1.56 to %1.66 a share.

TheStreet Ratings team rates FRESH MARKET INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate FRESH MARKET INC (TFM) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and premium valuation."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 6.5%. Since the same quarter one year prior, revenues rose by 15.1%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has significantly increased by 130.55% to $35.75 million when compared to the same quarter last year. In addition, FRESH MARKET INC has also vastly surpassed the industry average cash flow growth rate of 12.12%.
  • TFM's debt-to-equity ratio is very low at 0.20 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.22 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • The gross profit margin for FRESH MARKET INC is currently lower than what is desirable, coming in at 33.51%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.46% trails that of the industry average.
  • You can view the full analysis from the report here: TFM Ratings Report

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Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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