Ahead of Whole Foods Market, Inc. (NASDAQ:WFM) 3Q earnings expected on August 27th, Pivotal Research analyst Ajay Jain weighs in on the stock. He reiterates a Sell rating with a price target of $20.00.

According to the analyst, “As opposed to the sentiment heading into last quarter when WFM benefited from low expectations, we think there is a growing misperception that core fundamentals are improving with a meaningful recovery taking shape.”

The analyst upholds that signs of stabilization in SSS trends or even perceptions of improving fundamentals could have a significant impact on the company’s share price. The analyst affirms, “Risks to the company’s fundamentals include but are not limited to: the real estate pipeline increased competition; insufficient level of gross margin investment required to be appropriately price competitive; (and) any operational missteps/poor execution by management.”

Jain is ranked #1,229 of 4,079 analysts on TipRanks. He maintains a success rate of 50% and realizes an average return of 9.4%.