The shares of Whole Foods (WFM) are climbing after the company reported higher than expected third quarter profit and in-line Q3 revenue. However, two research firms expressed skepticism about the supermarket chain's outlook. Piper Jaffray wrote that its guidance may be optimistic and Jefferies warned that it's too early to say if the company's sales improvement is sustainable.

RESULTS: Whole Foods last night reported fourth quarter earnings per share of 28c, versus analysts' consensus outlook of 24c. The company's revenue came in at $3.5B, in-line with the consensus outlook. However, the supermarket chain's same-store sales fell 2.6%. Whole Foods predicted that its fiscal 2017 EPS would come in at $1.42 or higher, versus the consensus outlook of $1.47. The company estimated that its revenue would increase 2.5%-4.5% in fiscal 2017, and it estimated that its same-store would be down 2% to flat in fiscal 2017.

CEO CHANGE: Whole Foods also announced changes to its leadership structure, including transitioning from co-Chief Executive Officers to a sole Chief Executive Officer, with co-Founder John Mackey to serve in that capacity. Walter Robb will officially transition his co-CEO responsibilities on December 31, 2016, and will continue to be a senior advisor to the company and remain on the company's board of directors.

DIVIDEND BOOST: Whole Foods additionally declared an increase in the company's quarterly dividend to 14c per share from 13.5c per share, with the new dividend amount payable on January 24, 2017.

ANALYSTS SKEPTICAL: Whole Foods benefited from higher than expected gross margins last quarter, and its guidance "may be better than some expected," wrote Piper Jaffray analyst Sean Naughton. However, the guidance "appears optimistic," the analyst believes. Whole Foods' comparative sales trends have deteriorated so far this quarter, but the low end of its guidance assumes they will "improve throughout the year," he wrote. Furthermore, Whole Foods' decision to ease up on its price cuts and spend more on marketing is worrisome, given the tough competition in its sector, Naughton warned. He kept a $29 price target and a Neutral rating on the stock. Conversely, Jefferies analyst Christopher Mandeville called Whole Foods' guidance "comforting" and "better than feared," and he believes that the company's traffic trends have "showed modest progress" so far this quarter. The company's price cuts "are beginning to resonate," he added. But the outlook of its comparable store sales is uncertain, and its return on invested capital is still poised to drop again in 2017, Mandeville believes. The rally in its stock today could "prove fleeting" if its results falter, warned the analyst, who kept a $31 price target and a Hold rating on the stock.

PRICE ACTION: In late morning trading, Whole Foods rose nearly 3% to $29.28. However, the stock remains down about 12% year-to-date.