Institutional Watch: New Allocation by Prominent Investment Advisor Leaves Out Sprouts Farmers Market

Shaker Investments fully exited its position in Sprouts Farmers Market (NASDAQ:SFM) during the third quarter, according to an SEC filing dated October 17, 2025. The estimated value of shares sold was approximately $4.02 million, based on the average price during the quarter.

What Happened

According to a filing with the Securities and Exchange Commission dated October 17, 2025, Shaker Investments reported selling its entire stake of 24,441 shares in Sprouts Farmers Market during the quarter. The estimated transaction value, based on the average price for the period, was approximately $4.02 million. After the trade, the fund’s reported position in Sprouts Farmers Market is zero shares.

What Else to Know

Shaker Investments sold out its prior position in Sprouts Farmers Market, which previously represented 1.65% of reportable AUM as of June 30, 2025.

Top holdings after the filing:

• NYSE:AX: $33.84 million (13.5% of AUM) as of September 30, 2025
• NASDAQ:AVGO: $12.30 million (4.9% of AUM) as of September 30, 2025
• NASDAQ:NVDA: $12.30 million (4.9% of AUM) as of September 30, 2025
• NASDAQ:MSFT: $8.49 million (3.4% of AUM) as of September 30, 2025
• NASDAQ:GOOGL: $8.30 milion (3.3% of AUM) as of September 30, 2025

As of October 16, 2025, shares of Sprouts Farmers Market were priced at $111.55, down 4.58% over the past year through October 16, 2025. Shares have underperformed the S&P 500 by 18.55 percentage points over the same period.

Company Overview

Company Snapshot

Sprouts Farmers Market emphasizes natural and organic food offerings in the United States. It offers a broad assortment of fresh produce, meat, seafood, deli, bakery, dairy, and natural health products, as well as vitamins, supplements, and bulk food items.

The company operates a specialty grocery store model focused on natural and organic foods, generating revenue primarily from in-store retail sales across multiple perishable and non-perishable categories.

Sprouts targets health-conscious consumers seeking fresh, natural, and organic foods.

Foolish Take

By selling its entire stake in Sprouts Farmers Market, Shaker Investments has moved on from this grocery store stock. So, what is the lesson for retail investors?

First, some context. Going back to June 30, 2025, Sprouts made up 1.65% of Shaker's assets under management -- placing it well outside of its top five holdings. Nevertheless, Shaker owned more than $4 million of Sprouts stock, meaning this transaction was a big one.

What's more, this sale coincides with a downturn for Sprouts stock. After years of outperforming the S&P 500, Sprouts has struggled in 2025. Year-to-date, the stock has declined 12%, while the S&P 500 has advanced by 14%.

Nevertheless, the company's core fundamentals look solid. Its trailing 12-month revenue stands at $8.4 billion -- up around 24% from early 2023. In addition, its net income of $484 million has almost doubled from a low of $249 million in 2023.

Indeed, in a industry known for tight margins, Sprouts stands out. The company boasts an operating margin of around 7.7%. Compare that to Kroger, one of the most prominent grocers, which has an operating margin of only 3.2%.

In summary, this institutional sale shouldn't be viewed as the end of the line for Sprouts. Granted, Shaker Investment's sale is a large one, but Sprout's financials remain impressive, and the company's healthy margins set it apart from its fellow grocers. Retail investors would be wise to weigh the mixed signals before making any significant moves.

Glossary

Exited position: When an investor sells all holdings of a particular security, reducing their ownership to zero.
AUM (Assets Under Management): The total market value of investments managed by a fund or investment firm.
Reportable AUM: The portion of a fund’s assets required to be disclosed in regulatory filings.
Quarter (Q3 2025): The third three-month period of a financial year, here referring to July–September 2025.
Stake: The ownership interest or amount of shares held in a company by an investor or fund.
Filing: An official document submitted to regulators, often disclosing investment holdings or transactions.
Specialty grocery store model: A retail approach focused on offering niche or specialized food products, often targeting specific customer preferences.
Perishable categories: Product groups that include items with a limited shelf life, such as fresh produce, meat, and dairy.
Non-perishable categories: Product groups that include items with a long shelf life, such as canned goods and packaged foods.
TTM: The 12-month period ending with the most recent quarterly report.

Jake Lerch has positions in Alphabet and Nvidia. The Motley Fool has positions in and recommends Alphabet, Axos Financial, Microsoft, and Nvidia. The Motley Fool recommends Broadcom, Kroger, and Sprouts Farmers Market and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.