Goldman Sachs Moves Whole Foods To Conviction Buy

Goldman Sachs is moving Whole Foods Market WFMI to Conviction Buy List. It raised the price target to $76 from $64. It upgraded the name from Neutral. In a note to clients, Goldman Sachs writes, "We upgrade WFM to Buy from Neutral and add it to our Conviction List with 18% upside to our upwardly revised $76, 12-month price target. As noted in “Re-stocking our shelves with secular themes as cyclical turns stale” (7/11/11), we advocate buying into secular stories with accelerating fundamentals. Whole Foods checks these boxes due to (1) square footage growth moving from +LSD-MSD to +HSD rates; (2) sustained +HSD comps from inflation and price investments; and (3) operating margin expansion to 5.8% as store productivity reaches new peaks. With this note Stephen Grambling assumes primary coverage for WFM from Adrianne Shapira." Shares of WFMI closed at $64.36 on Friday.