Traffic Stabilizing on Toughest Comps; H2 Inflection Intact

Research evidence excerpt

Traffic Stabilizing on Toughest Comps; H2 Inflection Intact

USA | Food Retail

Sprouts Farmers Market EquityJulyResearch14, 2026

COMPANY UPDATETraffic Stabilizing on Toughest Comps; H2

RATING BUYInflection Intact

PRICE $80.86^

Traffic stabilized in Q2 after a sharp Q1 drop, with SFM's 3M rolling foot

traffic firming sequentially, per data we analyzed. Loyalty is normalizing as PRICE TARGET | % TO PT $95.00 | +17%

app engagement re-accelerates and mgmt framing monetization as a back- 52W HIGH-LOW $171.15 - $64.75

half story. Attribute-based demand remains the LT anchor. NT pressure is lap- FLOAT (%) | ADV MM (USD) 97.7% | 174.51

driven, not structural, in our view, and we see H2 inflection potential intact as MARKET CAP $7.7B

tough '25 laps are cycled. Reit BUY. TICKER SFM ^Prior trading day's closing price unless otherwise

noted.

Traffic stabilizing in Q2. After a sharp Q1 deceleration, our analysis suggests foot traffic firmed

modestly in Q2, with Placer data showing SFM's y/y 3M rolling foot traffic up ~33 bps in Jun vs. Mar.

FY (Dec) CHANGE TO JEFe JEF vs CONS

Still, SFM ranks last on absolute y/y foot traffic, pointing to stabilization and gradual improvement

2026 2027 2026 2027

rather than strong inflection. This tracks mgmt's read that April firmed slightly and that Apr-Jun

comps cycled steady +10% laps, leaving traffic ~flat through Q2. On affordability, mgmt continues REV* NA NA NM NM

to recalibrate PPA, expand entry-level price points, and lean into targeted promo, while noting the EBITDA NA NA NM -2%

loyal core is holding up and the fringe/newer consumer remains the pressure point.

2026 ($) Q1A Q2 Q3 Q4 FY

Loyalty normalizing, monetization an H2 story. App engagement, which surged ahead of EBITDA 259.6 214.3 209.3 193.7 876.9