Natural foods grocer Whole Foods Market, Inc. (NASDAQ:WFM), struggling amid organic competition from mainstream supermarkets, has a new problem on its hands.
According to a Bloomberg report, a major WFM shareholder is up in arms about the company’s underperformance:
One of Whole Foods Market Inc.’s largest shareholders has met with potential activist investors to discuss making sweeping changes to the upscale grocery chain, including replacing management and exploring a sale of the company, people with knowledge of the matter said.
The shareholder, who wasn’t identified but is among the top ten individual owners of the stock, is also reportedly meeting with activist investing groups to try and force the issue. His or her gripes include poor inventory management, rising costs, and inability to appeal to younger shoppers.
Several activist investors, who asked not to be named, said they are aware of the shareholder’s suggestions and are studying Whole Foods carefully. It’s unclear if any has begun accumulating a position in the Austin, Texas-based company, which has a market value of about $8.9 billion.
WFM stock has been more than halved since hitting its all-time highs around $65 about three years ago. The company’s latest earnings report was a mess, although shares briefly rallied following its release.
Whole Foods shares were halted for a few minutes today as this latest story broke, and rose $0.24 (+0.83%) to $28.69 in Friday afternoon trading. Year-to-date, WFM has fallen 14.28%.