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1. Company Snapshot

1.a. Company Description

Natural Grocers by Vitamin Cottage, Inc., together with its subsidiaries, retails natural and organic groceries, and dietary supplements in the United States.The company's stores offer natural and organic grocery products, such as organic produce; bulk food products; private label products comprising pasta, pasta sauce, ketchup, canned beans and vegetables, frozen vegetables, frozen fruits, frozen meals, frozen pizza, bread, baking mixes, plant based butter, olive and coconut oil, coconut milk, honey, maple syrup, preserves, chocolate, coffee, bacon, beef jerky, canned seafood, popcorn, tortilla chips, taco shells, eggs, cheese, apple sauce, apple cider vinegar, spring water, paper products, cleaning products, and other products; dry, frozen, and canned groceries; meat and seafood products; dairy products, dairy substitutes, and eggs; prepared foods; bread and baked products; beverages; and beer, wine, and hard cider products.Its stores also provide private label dietary supplements; body care products consisting of cosmetics, skin care, hair care, fragrance, and personal care products containing natural and organic ingredients; pet care and food products; books and handouts; and household and general merchandise, including cleaning supplies, paper products, and dish and laundry soaps, as well as other common household products, such as diapers.


The company operates its retail stores under the Natural Grocers by Vitamin Cottage trademark.As of February 1, 2022, it operated 162 stores in 20 states.The company also offers science-based nutrition education programs to help customers make informed health and nutrition choices.


Natural Grocers by Vitamin Cottage, Inc.was founded in 1955 and is headquartered in Lakewood, Colorado.

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1.b. Last Insights on NGVC

Natural Grocers by Vitamin Cottage, Inc.'s recent performance was impacted by decelerating sales growth. Despite reporting record full-year sales and earnings increases, the company's fourth-quarter earnings call highlighted a cautious outlook for fiscal 2026. The company's expansion of its house brand with new products, including 10 new varieties of organic frozen vegetables and three non-GMO pickle and relish styles, may not be enough to offset slowing growth. Additionally, the company's decision to increase its quarterly cash dividend by 25% to $0.15 per common share may be seen as a positive, but it does not address underlying growth concerns.

1.c. Company Highlights

2. Natural Grocers' Fiscal Year 2025 Earnings: A Strong Performance

Natural Grocers reported a robust financial performance for Fiscal Year 2025, with net sales increasing 4.2% to $336.1 million. The company's daily average comparable store sales growth of 4.2% and 11.3% on a two-year basis was a notable highlight. The operating margin improved 90 basis points, driving diluted earnings per share to a record $2 per share, beating expectations. The actual EPS for the quarter came out at $0.51, surpassing estimates of $0.4333.

Publication Date: Nov -23

📋 Highlights
  • Outperformed EPS Guidance:: Diluted earnings per share reached a record $2.00, exceeding expectations amid strong operational execution and expense leverage.
  • Comparable Sales Growth:: Daily average comparable store sales rose 4.2% YoY and 11.3% two-year, driven by improved store productivity and customer engagement.
  • Margin Expansion:: Operating margin improved 90 basis points, offsetting a 10-basis-point decline in gross margin due to lower product margins.
  • 2026 Growth Plan:: Targets $2–$2.15 in EPS, 1.5–4% comparable sales growth, and $50–55 million in CapEx for 6–8 new stores and 2–3 relocations/remodels.
  • Resilient Customer Base:: Core shoppers remain prioritizing health and wellness, maintaining sales momentum despite economic uncertainty.

Operational Execution and Strategic Initiatives

The company's strong performance was driven by its focus on operational execution, store productivity initiatives, and expense leverage. Co-President Kemper Isely emphasized the importance of these factors, as well as the growth of the company's Natural Grocers branded products and the enhancement of its nPower Rewards program. As Kemper noted, the company's "operational execution, store productivity initiatives, and expense leverage" were key drivers of its success.

Guidance and Outlook for Fiscal Year 2026

For Fiscal Year 2026, Natural Grocers expects to open six to eight new stores, relocate or remodel two to three existing stores, and achieve daily average comparable store sales growth between 1.5% and 4%. The company expects diluted earnings per share to range between $2 and $2.15. Analysts estimate revenue growth of 7.1% for the next year, indicating a continued upward trajectory.

Valuation Metrics

With a P/E Ratio of 14.24 and an EV/EBITDA of 12.55, Natural Grocers' valuation appears reasonable. The company's ROE of 23.52% and ROIC of 9.99% indicate a strong ability to generate returns on equity and invested capital. Additionally, the Free Cash Flow Yield of 7.6% suggests that the company is generating significant cash flows.

Growth Prospects and Strategic Investments

Natural Grocers is excited about its real estate pipeline and expects to continue driving growth through operational execution and strategic investments. The company plans to direct $50 million to $55 million towards capital expenditures to support its growth initiatives, including new store openings, relocations, and remodels. CFO Richard Helle noted that the company is "strategically buying some of our buildings to add more color to our CapEx," indicating a focus on controlling its assets and optimizing its investments.

3. NewsRoom

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Deck the Aisles with Natural Grocers®: Holly Deals Event, Dec. 6-22, 2025

Dec -04

Source: prnewswire.com

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Natural Grocers® Invites Grand Junction, CO Community to Celebrate Grand Reopening on December 17, 2025

Dec -03

Source: prnewswire.com

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Natural Grocers by Vitamin Cottage, Inc. $NGVC Shares Bought by American Century Companies Inc.

Dec -03

Source: defenseworld.net

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Get Ahead in 2026: Natural Grocers® Shares Key Trends for Living Well

Dec -02

Source: prnewswire.com

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Natural Grocers® Receives 2025 Sustainability in the Food Industry Award from The Shelby Report

Nov -21

Source: prnewswire.com

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Natural Grocers by Vitamin Cottage, Inc. (NGVC) Q4 2025 Earnings Call Transcript

Nov -20

Source: seekingalpha.com

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Natural Grocers by Vitamin Cottage, Inc. Declares Quarterly Dividend

Nov -20

Source: prnewswire.com

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Natural Grocers by Vitamin Cottage Announces Fiscal 2025 Fourth Quarter and Full Year Results

Nov -20

Source: prnewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.30%)

6. Segments

Grocery

Expected Growth: 8.5%

Natural Grocers' 8.5% growth in the grocery segment is driven by increasing demand for organic and natural products, expansion into new markets, and strategic pricing. The company's focus on private label products, loyalty programs, and employee expertise also contribute to its growth. Additionally, the rising health and wellness trend, as well as the increasing popularity of online shopping, further support the segment's growth.

Dietary Supplements

Expected Growth: 8.0%

Strong demand for natural and organic products, increasing health awareness, and expanding store count drive 8.0% growth in Dietary Supplements from Natural Grocers by Vitamin Cottage, Inc. Additionally, the company's focus on private label products and loyalty programs contribute to the segment's growth.

Body Care, Pet Care and Other

Expected Growth: 7.5%

{'Body Care': 'Strong demand for natural and organic personal care products, increasing consumer awareness of harsh chemicals, and expanding product offerings drive 7.5% growth.', 'Pet Care': 'Rising pet humanization, growing demand for natural and organic pet food, and increasing sales of pet supplements and treats contribute to 7.5% growth.', 'Other': 'Expansion of private label offerings, increasing sales of natural and specialty foods, and growing demand for dietary supplements drive 7.5% growth.'}

7. Detailed Products

Natural Foods

Natural Grocers offers a wide selection of natural and organic foods, including fresh produce, meats, dairy products, and packaged goods.

Vitamins and Supplements

Natural Grocers offers a vast array of vitamins, minerals, and supplements from reputable brands, catering to various health needs and preferences.

Body Care and Hygiene

Natural Grocers offers a variety of natural and organic body care products, including soaps, lotions, shampoos, and conditioners, free from harsh chemicals.

Natural Pet Food and Supplies

Natural Grocers offers a selection of natural and organic pet food, treats, and supplies, catering to the health and wellness of pets.

Natural Health and Wellness Services

Natural Grocers offers various health and wellness services, including nutrition counseling, health coaching, and free health screenings.

8. Natural Grocers by Vitamin Cottage, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Natural Grocers by Vitamin Cottage, Inc. faces moderate threat from substitutes as customers have limited options for natural and organic products, but they can still opt for conventional products or shop at other retailers.

Bargaining Power Of Customers

Natural Grocers by Vitamin Cottage, Inc. has a loyal customer base, and customers have limited bargaining power due to the unique products offered by the company.

Bargaining Power Of Suppliers

Natural Grocers by Vitamin Cottage, Inc. has a moderate bargaining power of suppliers, as it sources products from various suppliers, but some suppliers may have more bargaining power due to their size or specialty products.

Threat Of New Entrants

Natural Grocers by Vitamin Cottage, Inc. operates in a niche market, and new entrants may face significant barriers to entry, including high startup costs and the need to establish relationships with suppliers.

Intensity Of Rivalry

Natural Grocers by Vitamin Cottage, Inc. operates in a highly competitive market, with many established players, including Whole Foods Market, Sprouts Farmers Market, and Trader Joe's, which creates a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 68.42%
Debt Cost 3.95%
Equity Weight 31.58%
Equity Cost 9.03%
WACC 5.55%
Leverage 216.68%

11. Quality Control: Natural Grocers by Vitamin Cottage, Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

26.4$

Current Price

26.4$

Potential

-0.00%

Expected Cash-Flows