Stifel Canada has cut its price target on the shares of Pet Valu Holdings (PET.TO) by $9.00 to $23.00 after the company reported a first-quarter earnings miss.
Analyst Martin Landry, who is maintaining a buy rating on the shares, believes Pet Valu is negatively impacted by macroeconomic events rather than company specific issues. Consumer confidence has lagged in recent months, as inflationary pressure impacts discretionary spending. Still, the pet-food industry has resilient characteristics and Pet Valu seems to be gaining market share according to management, he writes. Pet Valu has an 18% market share, 300bps higher than the next competitor.
If the Iran conflict gets resolved, consumer confidence could return and fuel costs could abate, Landry adds. He is lowering his 2026 earnings per share forecast to $1.57, down 2% Y/Y, and flat when removing the extra week in 2025.
The revised price target reflects lower valuation multiples and lower forecast.
Price: $17.02, Change: $+0.02, Percent Change: +0.12%