LAKEWOOD, Colo. - Natural Grocers (NYSE:NGVC), a leading organic and natural grocery retailer, has expressed support for the Food and Drug Administration's (FDA) decision to revoke the use of brominated vegetable oil (BVO) in food products. The FDA's ruling, effective August 2, 2024, comes after studies highlighted potential health risks associated with the chemical.
BVO, a vegetable oil modified with bromine, has been used as an emulsifier in food since 1970. However, its safety has been in question, leading to the FDA's continuous reevaluation and subsequent restriction of its use in food items. The decision to prohibit BVO was based on collaborative research with the National Institutes of Health (NIH) that suggested possible adverse health effects in humans.
Natural Grocers, which has never carried products containing BVO, champions the recent FDA action. Heather Isely, Executive Vice President of Natural Grocers, emphasized the company's long-standing commitment to quality products and consumer transparency. Isely also highlighted the importance of grocery stores in shaping food production and the additives used in food items.
The retailer advises customers to read ingredient labels carefully to avoid BVO and other potentially harmful additives. Natural Grocers maintains a list of ingredients it deems problematic and chooses not to stock products containing such substances. This approach is part of the company's broader mission to offer nutritionally sound and environmentally responsible products.
With the FDA's ban set to be enforced starting August 2, 2025, manufacturers and retailers have a year to comply with the new regulation. Natural Grocers continues to provide extensive nutrition education and uphold strict quality standards in its selection of groceries, body care products, and dietary supplements.
The information in this article is based on a press release statement from Natural Grocers by Vitamin Cottage, Inc. (NYSE: NGVC). The company, founded in 1955, operates 168 stores across 21 states and is headquartered in Lakewood, Colorado.
In other recent news, Natural Grocers by Vitamin Cottage announced that its Chief Financial Officer, Todd Dissinger, plans to retire at the end of December 2024. The company will engage an executive search firm to find a successor and ensure a smooth transition. This comes alongside the company's record financial performance and shareholder value enhancement, largely credited to Dissinger's contributions during his tenure.
In terms of financial performance, Natural Grocers reported a robust second quarter for fiscal year 2024, with record sales and significant earnings growth. The company saw a 7.5% increase in daily average comparable store sales, largely driven by higher customer traffic and larger transactions.
Moreover, the company's diluted earnings per share rose by 34.6% to $0.35, prompting an upward revision of its fiscal 2024 guidance for sales growth and earnings.
The company plans to open four to six new stores and relocate or remodel an equal number. It projects daily average comparable store sales growth between 4% and 6%, and diluted earnings per share between $1.08 and $1.18. These recent developments indicate that Natural Grocers is well-positioned to maintain its growth trajectory in the health food retail market.
InvestingPro Insights
Natural Grocers by Vitamin Cottage, Inc. (NYSE: NGVC) has been making headlines not only for its commitment to health and safety by avoiding additives like BVO but also for its financial performance.
According to recent data from InvestingPro, the company has a market capitalization of $560.91 million and a P/E ratio that stands at 19.53, which indicates a valuation that could be attractive relative to near-term earnings growth. In fact, the company's P/E ratio adjusted for the last twelve months as of Q2 2024 is slightly lower at 19.12, with a PEG ratio of just 0.26, suggesting potential for growth at a reasonable price.
One of the InvestingPro Tips points out that Natural Grocers' trading is near its 52-week high, with the price of its shares reaching 98.05% of this peak value. This reflects a strong performance, as the company has seen a significant price uptick over the last six months, with a six-month price total return of 61.81%. The company has been profitable over the last twelve months, which aligns with its philosophy of offering high-quality and responsibly sourced products.
For investors interested in delving deeper into the financial health and future prospects of Natural Grocers, there are additional InvestingPro Tips available. These include considerations such as the company's short-term obligations relative to its liquid assets and its high return over the last year. For those looking to make informed investment decisions, using the coupon code PRONEWS24 can provide up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, offering access to a total of 9 additional InvestingPro Tips.
For more detailed analysis and tips on Natural Grocers and other stocks, visit InvestingPro at: https://www.investing.com/pro/NGVC.
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