WFMI stock price had begun to turn around even before they announced the merger with OATS. Immediately after this merger announcement, Whole Foods stock rose $6.41 (14.03%) in one day to close Thursday at 52.11. On Friday, WFMI gave back some of its gain and closed at 50.47. However, the company is still well below its 52-week high of 74.00 for WFMI.
Whole Foods is a member of the Standard and Poors 500 index. Some of the reasons that I have picked WFMI are because of the following:
- WFMI has been consistently profitable for several years according to the S&P Stock Report. I do not generally recommend investing in unprofitable companies.
- WFMI has a current dividend yield of 1.6%. I like to know that if the stock price stagnates, that I will still receive some income for having my money tied up.
- Whole Foods acquisition of Wild Oats expands the chain's market share in several regions.
- I consider the Wild Oats acquisition to be a long-term positive as the stock price has moved up for both WFMI and OATS. Typically when a larger company acquires a smaller rival, the acquiring company goes down in price and the takeover target goes up.