: United Natural Foods’ stock tanks after company swings to loss amid lower inflation benefits

by | Sep 26, 2023 | Stock Market

United Natural Foods Inc.’s stock tumbled 20% in premarket trade Tuesday, after the grocery wholesaler swung to a fiscal fourth-quarter loss and posted sales that lagged estimates. The Providence, Rhode Island-based company
had a net loss of $68 million, or $1.15 a share, for the quarter to July 29, after income of $39 million, or 63 cents a share, in the year-earlier quarter. It’s adjusted per-share loss came to 25 cents, narrower than the 39 cent loss consensus of FactSet analysts.

Sales rose to $7.417 billion from $7.273 billion, but were below the $7.467 billion FactSet consensus. “While we grew sales across all of our customer channels, profitability declined primarily due to a decrease in inflation driven procurement gains and elevated shrink. We expect further headwinds as we continue to cycle elevated inflationary benefits during the first half of fiscal 2024,” CEO Sandy Douglas said in a statement. Shrink can refer to damaged goods, but has lately more often meant shoplifting and is a problem that many retailers have complained about this earnings reporting season. Many have said it’s being conducted by organized gangs and is costing millions of dollars a year. See: Walmart’s ‘shrink’ challenges differ from those of other retail giants, CEO says Related: Target facing ‘unacceptable amount’ of retail theft and organized retail crime, CEO says United Natural Foods is now expecting fiscal 2024 per-share earnings to range from a loss of 88 cents to EPS of 38 cents, compared …

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