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Natural Grocers: Good Business But Expensive Stock

Natural Grocers (NYSE:NGVC), which has witnessed 45 quarters of comparable store sales growth and sustained the growth momentum even during the financial crisis, is definitely worth a look. Also, being a specialty retailer of natural, organic groceries and dietary supplements adds to the attractiveness of the business. The natural and organic food segment as a percentage of total food sales in the United States was just 7% in 2010, suggesting significant under penetration.

Natural Grocers sells grocery products that contain no artificial colors, flavors, preservatives, sweeteners or partially hydrogenated or hydrogenated oils. This sets it apart from most grocery stores. Besides the carefully vetted products, an attractive pricing strategy is the differentiating factor for the company.

Given the...

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