In the following video, Fool.com analysts Austin Smith and Jim Mueller are generally upbeat about Whole Foods Market (NASDAQ: WFM), but they want to warn investors of three risks the company faces.
Jim thinks the possibility of another recession is the biggest risk to this upscale organic-grocery chain, as the Great Recession correlated with Whole Foods' largest stock-price drop. Two other threats to the store's profitability are higher underlying food costs and an increase in commercial lease rates.
Austin points out that while these three threats could hurt Whole Foods' bottom line, they'd also harm its competitors. On the whole, the analysts share a cautiously optimistic outlook.
Austin Smith and Jim Mueller have no positions in the stocks mentioned above. The Motley Fool owns shares of Whole Foods Market. Motley Fool newsletter services recommend The Fresh Market and Whole Foods Market. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.