What is Whole Foods’ stock price, and are they publicly traded? Unfortunately, investors cannot purchase shares of Whole Foods because it is a private company. However, Kroger (NYSE: KR), Amazon (NASDAQ: AMZN), and Walmart (NYSE: WMT) are grocery stocks that traders can invest in.
When investing for the long term, it’s important to identify strong sectors that can withstand a weaker economy. One of the first industries that comes to mind is grocery stores. Why? Unless you are a self-sufficient farmer, chances are you get your food and ingredients from a grocery store. It is a behavior that is consistent across all socioeconomic classes. So, as investors, buying grocery store stocks seems like a no-brainer.
With the push towards healthier eating and organic ingredients, stores like Whole Foods have become popular. Whole Foods is an ideal target for investment. With a strong global brand presence and the backing of one of the world’s most powerful companies, Whole Foods should make a great long-term investment. This article will discuss its corporate history, investing in Whole Foods stock, and diversifying into some of its industry rivals.
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Whole Foods Introduction (No Stock Symbol)
Whole Foods is an American multinational grocery chain founded in 1978 in Austin, Texas. The chain is widely known for its healthier alternatives, including organic products without added sugars, fats, and artificial preservatives. John Mackey and Renee Lawson as SaferWay, a vegetarian natural foods store in Austin, founded it. The name was a play on the established non-organic grocery store Safeway.
SaferWay had an ominous start as the couple was evicted from their apartment for storing food products. With nowhere to go, Mackey and Lawson lived inside the Safeway store. Two years later, SaferWay merged with another local grocery store called Clarksville Natural Grocer. The new store was renamed Whole Foods Market and took over a 10,500-square-foot building as its first location.
Whole Foods was almost destroyed by the massive flood that hit Austin in 1981. The store suffered significant damage, and all of its inventory was destroyed. The company had no insurance, and investors and vendors helped it get back on its feet. In 1984, Whole Foods Market expanded outside of Austin and opened stores in Houston, Dallas, and New Orleans.
By 1989, Whole Foods had expanded to the West Coast with its first store in Palo Alto, California. Three years later, in 1992, Whole Foods stock had its initial public offering (IPO) and was listed on the NASDAQ exchange under the WFM ticker. By 1999, Whole Foods had more than 100 locations, and in 2002, the company expanded North into Canada.
In 2017, Whole Foods was acquired by Amazon Inc for $13.7 billion. Whole Foods operates over 500 locations across North America and the United Kingdom. In 2023, Whole Foods made nearly $20 billion in annual revenue.
Can I Buy Whole Foods Stock?
So, if Whole Foods is such a successful grocery chain, why not buy its stock? As we mentioned, Whole Foods was acquired by Amazon in 2017. Whole Foods was no longer listed as a public company when this acquisition occurred. The company operates under Amazon’s control and is no longer traded on the NASDAQ index.
If you want to have exposure to Whole Foods stock in your portfolio, you can buy Amazon. You are investing in Whole Foods and getting exposure to Amazon’s marketplace, Amazon Prime, and Amazon Web Services.
Whole Foods Stock Competitors
Yes, there are plenty of publicly listed grocery store stocks that you can invest in. Whole Foods stock was a great stock to own, but since it is no longer public, we’ll have to look at other grocery stocks to buy. Here is our list of the top grocery stocks, like Whole Foods, that you should invest in long-term.
1. Amazon (NASDAQ: AMZN)
We’d be remiss not to include Amazon stock on this list. Of course, as we’ve mentioned multiple times, Amazon acquired Whole Foods in 2017. Therefore, if you want to invest in Whole Foods stock, you’ll want to own some Amazon stock in your portfolio. Owning Amazon stock is a great idea, even if you don’t need exposure to Whole Foods.
Amazon is the fifth-largest company in the world by market cap as of July 2024. The company is best known for its vast online marketplace and Prime membership.
However, Amazon owns many other businesses, including the highly profitable AWS or Amazon Web Services cloud computing platform. Amazon has over 230 million Prime members worldwide and earned a staggering $574 billion in revenue in 2023.
2. Walmart (NYSE: WMT)
The next stock to own is Amazon’s largest retail rival. It is the fifteenth-largest company in the world by market cap and the largest retail company by annual revenue. Walmart was founded in Arkansas in 1962 by the Walton family and has since opened more than 10,500 stores worldwide.
Walmart stock has been a consistent winner for shareholders. The stock is a component of the S&P 500 and the Dow Jones Industrial Average. Over the past five years, Walmart has returned more than 84% to shareholders and pays a 1.18% quarterly dividend. Walmart underwent a 3-for-1 stock split in February 2024, the stock’s first split in more than twenty years.
3. Costco (NASDAQ: COST)
Costco is a big box retailer that operates under a paid membership system. It is the third-largest retail company in the world by market cap after Amazon and Walmart. Therefore, it is a great Whole Foods stock alternative.
Costco was founded in 1983 in Seattle, Washington, and now operates 879 locations worldwide. In 2023, Costco brought in more than $242 billion in annual revenue.
The stock is one of the largest weighted holdings in the NASDAQ 100 index. It’s the largest non-tech company listed on the NASDAQ, with the tenth-largest allocation or about 2.54% of the index. In July 2024, Costco announced that it would raise its membership price for regular and executive members.
It is the first time that Costo has raised its membership price since 2017. Over the past five years, COST has returned more than 216% to shareholders and currently pays a 0.52% dividend yield.
4. Kroger (NYSE: KR)
Kroger is an American grocery store chain founded in 1883 in Cincinnati, Ohio. The company owns multiple grocery chains, including Fred Meyer, QFC, City Market, and Dillons. Kroger owns and operates more than 2,700 grocery stores across the United States.
This company is considerably smaller than the first three mentioned on our list. Over the past five years, the stock has returned more than 142% to shareholders. It is a component of the S&P 500 and currently pays an annualized dividend yield of 2.42%.
5. Sprouts Farm Market (NASDAQ: SFM)
Sprouts Farm Market is an American supermarket chain focusing on natural and organic foods, similar to Whole Foods. The company was founded in Phoenix, Arizona, in 2002 but was originally a fresh food stand by Henry Boney in 1943. Years later, his sons opened Boney’s Market, which eventually became Sprouts Farm Market in 2002.
This supermarket chain has 413 stores across 23 American states from Washington State to Florida. As of July 2024, Sprouts Farm Market is an $8.3 billion company component of the S&P 400 midcap index.
The stock does not pay dividends like the other stocks on this list. In 2023, Sprouts Farm Market brought in $6.8 billion in annual revenue.
Is There a Grocery Stock ETF?
While there isn’t an ETF dedicated strictly to grocery store stocks, some interesting options exist. Two of our favorite ETFs with grocery stocks are funds that hold consumer staples companies. Investing in these ETFs provides wide exposure to multiple grocery stocks and consumer staples companies.
The Vanguard Consumer Staples ETF (VDC)
This Vanguard ETF holds 105 holdings, including grocery stocks like Costco, Walmart, Kroger, Sprouts Farm Market, and Albertsons. It also holds retail stocks like Target, Dollar General, and Dollar Tree. This ETF has a solid management expense ratio or MER of just 0.10% and pays a dividend yield of 2.62%. Since the fund was introduced in January 2004, it has returned 538.5% to shareholders.
The Consumer Staples Select Sector SPDR Fund (XLP)
XLP is the largest consumer staples ETF on the market, with about $15.7 billion in assets under management. This fund holds grocery stocks like Costco, Walmart, and Target and has a 34% allocation to Consumer Staples Distribution and Retail stocks. XLP has a MER of 0.09%, slightly cheaper than VDC. It holds 38 different stocks and pays a 30-day SEC yield of 2.44%.
Final Thoughts: Whole Foods Stock
Grocery stores and supermarkets are considered to be stable businesses and good investments. These businesses are used by consumers no matter how weak or strong the economy is. We all need to eat, and unless we own a farm, chances are that most of our food is purchased at a supermarket.
Some of the largest companies in the world, according to annual revenue, are grocery and retail stores. Stocks like Amazon and Walmart lead a solid sector to invest in.
While you can’t buy Whole Foods stock anymore, you can gain exposure by investing in Amazon. Whether you are considering a grocery stock or grocery ETF, these companies make for stable long-term investments that usually pay out a steady dividend.
If you enjoyed this article on Whole Foods Stock, come check out our investing community at BullishBears.com.
Frequently Asked Questions
Whole Foods no longer has stock as it was acquired by Amazon in 2017. The company traded on the NASDAQ index since its IPO in January 1992. To invest in Whole Foods today, you must buy Amazon stock.
Yes, Amazon wholly owns Whole Foods after it acquired the grocery chain in 2017 for $13.7 billion. Although Amazon owns it, Whole Foods still operates independently and has a CEO and executive team.
As of July 2024, the current CEO of Whole Foods is Jason Buechel. After brief stints as the company’s CIO and COO, Buechel succeeded the company’s only CEO since inception, co-founder John Mackey.
No, Trader Joe’s is privately owned and one of the largest rivals to Whole Foods in America. The company has more than 500 locations nationwide and is owned by German supermarket conglomerate Aldi.
