Well liberfar time will tell which of is right about the future growth prospects of Whole Foods. I've been right so far.

Acquisitions account for about 1/3 of the existing Whole Foods stores. Most of these acquisitions were apparently "platform" acquisitions which gave the company valuable infrastructure to accelerate their new store expansion (Bread & Circus, Fresh Fields, Mrs. Gooch's and Harry's were by appearances platform acquisitions). Once the platform infrastructure was in place Whole Foods has used the platform to open more stores with. It appears that the company need not do any additional platform acquisitions to support their growth for many years to come.

What evidence do you have that Whole Foods is close to hitting saturation with their concept? All the evidence is pointing the other way. You need to answer the following facts:
1. WFMI has had same store sales the last 4 quarters of 9.6%, 10.1%, 10.2%, and 9.4%. They've done this in an economy in recession. So much for Whole Foods being vulnerable during an economic slowdown.
2. WFMI is in only 30 of the top 50 metro markets.
3. In most of their existing markets they are far from saturation. For example, they have only 1 store in Manhattan (hugely successful too).
4. Their growth is accelerating, not slowing right now.
5. With the demise of Wild Oats, Whole Foods Market has no national competitors in their niche. This will accelerate their growth.
6. WFMI has bright international expansion prospects. They are opening their first store in Canada in late Spring. Can European expansion be very far off?

It is easy to say that Whole Foods Market's concept will eventually reach saturation (this is a truism and doesn't convey meaningful information). What is more difficult to do is to say when they will reach saturation. You say it will be relatively soon, but provide no reasons or evidence for your position. You say that you "can't imagine them being able to put in 100-200 more of their huge stores without experiencing cannibalization", but the fact is that WFMI has been experiencing strong cannibalization for years in markets such as Dallas, Boston, Los Angeles, and Washington D.C. without that slowing their growth or their incredible same store sales.

How big can Whole Foods eventually get? I gave my opinion in my previous post. I believe that $10 billion in sales by 2010 or 2011 is quite possible. That's why I'm still holding my long-term position.