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Sprouts Shares Double During IPO

PHOENIX — Riding a compelling growth story in a hot industry, Sprouts Farmers Market literally and figuratively rang the bell of the NASDAQ stock market during its first day of trading Aug. 1.

Jon Springer, Executive Editor

August 12, 2013

2 Min Read
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PHOENIX — Riding a compelling growth story in a hot industry, Sprouts Farmers Market literally and figuratively rang the bell of the NASDAQ stock market during its first day of trading Aug. 1.

The natural food retailer raised $333 million by selling 18.5 million shares at $18 during the initial offering — shares that were initially expected to sell between $14 and $16 per share, according to a prospectus. On the public market, shares opened at $35 and closed at $40.23 — an increase of more than 123% in its first day.

Doug Sanders

, Sprouts president and chief executive officer, in an interview with SN said he felt investors were attracted by Sprouts’ strong performance and long-term growth prospects, and by momentum in the natural/organic industry.

“There’s a lot of growth in our sector and a lot tailwind in natural and organic,” Sanders said. “We’ve grown into a pretty sizeable company over the years and have some tremendous momentum.”

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Sanders told SN he sees a large opportunity for growth by using sharp pricing in produce to lure traditional supermarket shoppers to its stores, then converting them to become primary shoppers at Sprouts. The company also has plenty of “white space” for growth. Sprouts intends to open 20 new stores this year and increase its store count by 12% a year thereafter.

Expansion plans include a store next year in Atlanta — which would be Sprouts’ first stores outside of the Southwest. Sanders said the company would use the Atlanta as a base for additional growth in the Southeast.

 

About the Author

Jon Springer

Executive Editor

Jon Springer is executive editor of Winsight Grocery Business with responsibility for leading its digital news team. Jon has more than 20 years of experience covering consumer business and retail in New York, including more than 14 years at the Retail/Financial desk at Supermarket News. His previous experience includes covering consumer markets for KPMG’s Insiders; the U.S. beverage industry for Beverage Spectrum; and he was a Senior Editor covering commercial real estate and retail for the International Council of Shopping Centers. Jon began his career as a sports reporter and features editor for the Cecil Whig, a daily newspaper in Elkton, Md. Jon is also the author of two books on baseball. He has a Bachelor of Arts degree in English-Journalism from the University of Delaware. He lives in Brooklyn, N.Y. with his family.

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