Xin He
Long/short equity, value, growth, contrarian

Why The Fresh Market May Get Cheap Enough To Lure Contrarians

Specialty grocery retailer The Fresh Market (NASDAQ:TFM) tumbled more than 19% on Friday last week after reporting disappointing third-quarter earnings and cutting its earnings guidance for full fiscal year 2013. TFM now expects earnings between $1.42 per share - $1.47 per share versus previous guidance $1.5 - $1.55 per share.

My first impression of this big drop was a "WOW." TFM has always been a nice company with very clear and strong business model. The grocery market is a brutal world with low profit margins and highly competitive environments. Given the high P/E ratio, TFM is providing investors good growth rate around 15%-20% per year. And of course, TFM's brand name occupies a significant amount of its market...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
FREESA PRO MEMBERS
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details