SFM
Sprouts Farmers Market, Inc.
$64.72
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Overvalued
Trading 1.6% above fair value
You pay
$64.72
Bear
$53.10
Fair
$63.72
Bull
$74.34
Bear
$53.10
-18.0%
$5.31 × 10x P/E
Fair
$63.72
-1.5%
$5.31 × 12x P/E
Bull
$74.34
+14.9%
$5.31 × 14x P/E
Adjust Assumptions
12.0x
5.31$
Key Value Driver
Normalized P/E multiple (12x base case)
Implied Market Multiple
12.2x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (43 analysts)
$92.57
Divergence from AlphaVal
31%
Summary
Applying a 12x P/E to adjusted EPS of $5.31, the base-case value is $63.72 per share.
Warnings
Wall Street's average price target is $92.57 (from 43 analysts). Our estimate is 31% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples