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Analysts back Fairway expansion plans despite slack earnings
New York-based grocery chain to open between two and four new stores annually
Fairway Market is clinging to a strategy of opening up to 300 new stores across the country in coming years to reverse disappointing earnings and investor ire that has bubbled up since the company went public in April 2013. The shop’s next two locations, on Long Island and on Manhattan’s far West Side, are slated to open this year.
The supermarket’s initial goal to launch between two and four new stores annually, starting in 2015, is not without its detractors. Still, some analysts told Crain’s that the popular store will be able to offset its capital expenditures on the new stores with their operating capital once those locations become operational.
Two such new shops are on tap for this year, and Fairway opened two new stores last year in Chelsea and Nanuet, N.J.
Known for its unusual in-store layout and quirky marketing, Fairway’s stock price tumbled almost 30 percent after the company went public in April last year, and the chain reported losses in each subsequent quarter. Several shareholders filed lawsuits seeking class-action status after disappointing quarterly earnings were released last month. A court ruling on the complaint has not yet been handed down. [Crain’s] — Julie Strickland