Natural Foods Stocks Gain as Consumers Prioritize Health & Wellness

A key driver of this shift is the increasing focus on product transparency and ingredient quality. Buyers are paying closer attention to labels, favoring foods with recognizable ingredients, minimal processing, and attributes such as organic, non-GMO, and preservative-free formulations. As a result, clean-label offerings have evolved from a temporary consumer trend into a more durable purchasing behavior, encouraging food manufacturers and retailers to expand their portfolios of natural and health-focused products.

The industry is also benefiting from stronger food-labeling standards and broader public health initiatives that promote informed consumer choices. Companies that emphasize transparent sourcing, high product quality, ethical supply chains and sustainable production practices are strengthening brand credibility and customer loyalty. These advantages often support premium pricing, as consumers increasingly demonstrate a willingness to pay more for products they perceive as healthier, safer and responsibly produced, creating a favorable backdrop for natural food companies.

Companies like Natural Grocers by Vitamin Cottage, Inc. NGVC and The Kroger Co. KR are strengthening their competitive positions by broadening product assortments, expanding private-label offerings and improving access to natural and organic foods across their store networks. Scale, sourcing capabilities and differentiated merchandising can help these companies capture a larger share of health-focused consumer spending while supporting customer retention and basket growth.

Future industry growth is likely to be shaped by product innovation and broader distribution. Investment in plant-based foods, functional nutrition, sustainable agriculture and digital commerce is enabling companies to reach new customer groups and respond more quickly to changing preferences. The expansion of online grocery platforms and convenient fulfillment options is also reducing barriers to purchase, making specialty products such as organic, gluten-free and nutrient-enhanced foods more accessible to a wider consumer base. The healthy food industry is projected to grow to $2,052.5 billion by 2035.

If you're looking to capitalize on this trend, our Natural Foods Screen makes it easy to identify high-potential stocks such as United Natural Foods, Inc. UNFI, Sprouts Farmers Market, Inc. SFM and The Simply Good Foods Company SMPL.

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3 Natural Food Stocks to Watch

United Natural Foods occupies a unique position in the U.S. grocery ecosystem as the leading distributor serving natural, organic, specialty and differentiated food retailers. As consumer demand increasingly shifts toward healthier, sustainably sourced and wellness-oriented products, the company continues to strengthen its role in the natural and organic category. For the third quarter of fiscal 2026, UNFI reported natural product sales growth of more than 4%, outperforming the broader market and reflecting resilient shopper demand for natural, organic, fresh and specialty foods. Management emphasized that natural and organic retailers have nearly tripled their share of the U.S. grocery market over the past two decades, reinforcing the attractiveness of this segment. UNFI’s strategy centers on helping retailers differentiate through premium assortments and health-focused offerings, positioning the company to benefit from long-term category expansion. 

UNFI is actively expanding its natural and organic ecosystem through merchandising innovation, supplier support and digital capabilities. A key initiative is the launch of its new digital marketplace, Endless Aisle, which enables retailers to access innovative emerging brands more efficiently while helping suppliers broaden distribution. The company also introduced more than 30 new private-brand SKUs during the quarter, enhancing retailers’ ability to differentiate their assortments and respond to growing consumer interest in nutritious and wellness-oriented products. 

Through its extensive portfolio of natural, organic and specialty offerings, UNFI supports a wide range of customers, from dedicated natural food retailers to regional grocers seeking to strengthen their health-and-wellness credentials. Management noted that assortment optimization and access to natural and organic products remain central themes in conversations with customers pursuing differentiated retail strategies. 

To support continued growth in natural and organic foods, UNFI is investing heavily in supply-chain modernization and technology-driven efficiency. The company expanded its AI-powered supply chain and procurement planning platform across its entire distribution center network, improving inventory management, fill rates and free-cash-flow conversion. It also broadened deployment of the Samsara fleet management platform and extended its cloud-based warehouse management system to five additional distribution centers. These initiatives contributed to higher service levels, including improved fill rates, stronger on-time deliveries and increased throughput. Management highlighted that underlying natural sales growth has consistently delivered mid-teens growth on a two-year stacked basis, demonstrating the durability of demand for natural and organic products. 

This Zacks Rank #1 (Strong Buy) company expects its growing wholesale pipeline, technology investments and focus on differentiated food retail to support continued expansion. You can see the complete list of today’s Zacks #1 Rank stocks here.

Sprouts Farmers has built its business around making natural, organic and better-for-you products accessible to a broader consumer base, positioning itself as a differentiated retailer in the healthy grocery space. Fresh produce remains at the center of its merchandising strategy, complemented by a growing assortment of organic, plant-based and gluten-free products designed to meet evolving consumer preferences. During the second quarter of 2026, management emphasized that its attribute-based assortment continued to resonate with shoppers despite a cautious spending environment. Organic products now account for more than 30% of total sales, while organic penetration exceeds 50% in the dairy and produce categories, highlighting the strength of the company’s natural and organic positioning. The Sprouts private-label brand also continued to outperform the broader business, contributing 26% of quarterly sales and reinforcing customer loyalty through differentiated, health-focused offerings.

Sprouts is sustaining its leadership in natural foods through continuous product innovation and exclusive brand partnerships. The company introduced approximately 1,300 new products during the second quarter, prioritizing attributes that resonate with wellness-focused consumers, including organic, seed oil-free, fiber-rich, gut-health and protein-oriented offerings. Exclusive products such as Pasturebird chicken, now available nationwide across Sprouts stores, alongside emerging brands like Better Than Pop and Soup Salt Shots, strengthen the retailer’s differentiated assortment. Management is also expanding healthy meal solutions through fresh deli offerings, $9.99 wellness bowls, affordable family meals and innovative Sprouts-branded products, including seed oil-free frozen potatoes and fresh organic sourdough bread. These initiatives are intended to combine affordability with product innovation, helping consumers maintain healthier eating habits without compromising value.

Beyond merchandising, this Zacks Rank #3 (Hold) company is investing in capabilities that strengthen its natural and organic ecosystem over the long term. The company continues to expand its loyalty and personalization platform, using first-party customer data to tailor promotions, improve product discovery and enhance marketing effectiveness. Supply-chain investments are also supporting its natural food strategy, with the Northern California distribution center now operational and nearly 85% of stores receiving fresh meat through Sprouts-operated distribution centers, improving freshness, service levels and cost efficiency. Management is extending self-distribution beyond produce and meat to selected Sprouts-brand products. Its aggressive store expansion program will broaden access to its natural and organic assortment. Together, these initiatives position Sprouts to deepen customer engagement, improve execution and support sustainable growth in the health-focused grocery market.

Simply Good Foods has positioned itself within the broader health and wellness movement by offering nutritious snacks that cater to consumers seeking high-protein, low-sugar, and clean-label alternatives. Management continues to view the purposeful nutrition category as an attractive long-term market, supported by enduring trends in health, wellness, and convenient nutrition rather than short-term consumer fads. The company believes its portfolio addresses distinct consumer needs through the Quest, Atkins, and OWYN brands, each targeting different wellness occasions. 

Quest remains the company's largest growth engine. Atkins continues to serve weight-management consumers, while OWYN strengthens its presence in plant-based, clean-label nutrition. Management emphasized that the company's recent challenges stem primarily from execution rather than weakening demand, reinforcing confidence in the long-term growth opportunity for healthier food and beverage products. 

Quest continues to anchor Simply Good Foods' strategy with products designed around better-for-you nutrition and evolving consumer preferences. The brand posted another increase in household penetration to 20.5% in the third quarter of fiscal 2026, demonstrating continued consumer relevance despite softer overall performance. Quest chips remained a standout performer, with consumption increasing more than 17% as shoppers increasingly sought healthier salty snack alternatives. The milkshake business also recorded strong growth. Management is now concentrating on restoring momentum in its core protein bar franchise by improving innovation, refining product development around changing consumer preferences and strengthening brand communication.; 

This Zacks Rank #3 company is also advancing its natural and clean-label portfolio through strategic investments in Atkins and OWYN while reshaping its broader growth platform. Management believes Atkins retains significant relevance in a GLP-1 environment by supporting consumers focused on weight management and intends to rebuild the brand through disciplined marketing and clearer consumer messaging. Meanwhile, OWYN remains central to the company's plant-based strategy despite recent execution challenges. Consumer research indicates that nearly 18% of U.S. households actively seek functional nutrition with plant-based protein and clean-label ingredients, providing a sizable growth runway. Following the completion of its distribution reset, Simply Good Foods plans to focus on its core ready-to-drink shakes and powder products through OWYN while increasing marketing to improve awareness, trial, and household penetration. Alongside continued investments in innovation, R&D, and brand building, these initiatives are expected to strengthen the company's health-focused portfolio over time.

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