After popularizing luxury groceries for the well-off, Whole Foods is trying to take the concept to the masses. But amid growing inequality and a sluggish recovery, those masses have gone missing.
That could spell trouble for the Austin, Texas-based grocer. Investors have doubtsabout whether the company can keep up its long track record of steady sales growth, now that it has saturated the upper-middle-class enclaves on the coasts. Its stock price has been pummeled lately, dropping about 30 percent in the past six months.
"They have to expand beyond where they currently are, and that's kind of the concern," said David McGoldrick, a U.S. analyst at the market research firm Euromonitor International. "Are they going to be able to find customers in other parts of the country, where incomes are lower, that are going to be able to spend at Whole Foods?"