FINANCE 3 PAGESPROF HENRY CONALI
Whole Foods Market (WFM) has experienced disappointing profits over the past few yearsdespite increasing its revenues during the same interval. While WFM’s total revenuesincreased by approximately 2% in 2016, and 8% in 2015, its net income (profit) declined byabout 5% and 7% in 2016 and 2015 respectively, indicating higher costs of operating theirbusinesses. The size of the WFM balance sheet has been growing larger; however, the WFMcommon stock experienced high volatility and posted a devastating loss to its value from ahigh of $65/share in October 2013 to about $31/share in December 2016. This performancewas more distressing to WFM investors as the S&P 500 stock index experienced gainsduring the same interval. The decision to open the lower-cost 365 supermarkets has beenmade against this financial background, in addition to other concerns relating to the long-termhealthiness and growth of its core upscale supermarket business.
1. Opening a series of new supermarkets, such as 365, is a major capital budgetingproject for the company. A project of this scale requires coordinated planning acrossall functions of a business that you are studying in your Integrated Core classes.Choose and discuss three items each on the income statement and the balance sheetthat you think will be impacted by this new undertaking (a total of six items). Explainwhy you chose those particular items, and how those items might be impacted by the
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Whole Foods Market (WFM) has experienced disappointing profits over the past few yearsdespite increasing its revenues during the same interval. While WFM’stotal revenues…4 years ago