Natural Grocers by Vitamin Cottage, Inc.

Worth knowing

• Stock pay outran buybacks. Stock-based pay expense $8M vs $0M spent repurchasing shares over the 3 fiscal years to FY Sep 2025. Shares outstanding changed +1.6% from September 2022 to August 2026.

  Over three fiscal years Natural Grocers by Vitamin Cottage recorded $8M of stock-based pay expense and spent $0M repurchasing shares (repurchases can include shares withheld to cover employees' taxes). Repurchases were smaller than the stock pay, so they did little to offset new employee shares.Over three fiscal years Natural Grocers by Vitamin Cottage recorded $8M of stock-based pay expense and spent $0M repurchasing shares. Repurchases were smaller than the stock pay, so they did little to offset new employee shares.

• Profit isn't fully turning into cash. Free cash flow is only 48% of reported profit.

  Free cash flow is only 48% of reported profit. That usually means heavy spending on facilities and equipment, or cash tied up in inventory and unpaid bills. Worth checking whether it's a phase of investment or a lasting pattern.

• Valuation signals disagree. Cheaper than 80% of peers on operating cash profit (EBITDA), but only 31% on free cash flow.Cheaper than 80% of peers on operating cash profit, but only 31% on free cash flow.

  Relative to its operating cash profit (EBITDA), Natural Grocers by Vitamin Cottage looks cheaper than 80% of peers; relative to its free cash flow, cheaper than only 31%. The valuation score blends the two, so look at which measure fits this business best.Relative to its operating cash profit, Natural Grocers by Vitamin Cottage looks cheaper than 80% of peers; relative to its free cash flow, cheaper than only 31%. The valuation score blends the two, so look at which measure fits this business best.

• Profits growing faster than sales. Since FY Sep 2022: revenue +22%, operating profit +106%.

  Since FY Sep 2022, Natural Grocers by Vitamin Cottage's revenue grew 22% while operating profit grew 106%: each extra dollar of sales is adding more profit.