FTC settlement, cost cuts propel Whole Foods up, says analyst

New York City Wall Street has given a thumbs up to Whole Foods Market, saying the grocer is doing a good job cutting costs to counter the recession’s impact on sales.

An analyst upgraded Whole Foods’ stock on Monday to “market perform” from “underperform.” According to FBR Capital Markets analyst Karen Short, Whole Foods’ expectations of $8.3 billion in sales in 2009 are “possibly too conservative,” and instead expects sales of $8.61 billion in 2009 and cited fourth-quarter results as “a testament to management's skill in adapting to a rapidly changing environment.”

In its fiscal first quarter, Whole Foods said same-store sales fell by 4%, from a year ago. Short also said the company's recent settlement with the Federal Trade Commission was "favorable." Whole Foods agreed to settle federal regulators' antitrust charges by putting 13 stores -- 12 Wild Oats Markets stores, one Whole Foods store -- up for sale. The company will also sell leases and assets of 19 closed Wild Oats stores.

Whole Foods acquired natural supermarket chain Wild Oats Markets in 2007.