Research Alert: CFRA Maintains Hold Rating On Shares Of Premium Brands Holdings Corporation
CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:We maintain our Hold rating on PBH and lower our target price to CAD95 from CAD98. This is based on an earnings multiple of 15x our FY 27 adjusted earnings per share of CAD6.37. The inflationary impact on input costs remains. However, the U.S. inorganic growth strategy has overwhelmed the gross margin compression. Revenues and EBITDA grew in the mid-20% range due to the Stampede acquisition, but adjusted EPS grew ony 18.6% as dilution from the deal took its toll. Valuations are depressed to the lower band of long-term historical averages. However, we feel this is justified due to inflationary pressures weighing on margins. Should these input costs recede, we feel the tuck-in experience at PBH can drive synergies to expand margins. We remain cautious in regard to consumer behavior as the cost at the pump continues to rise. We lower our 2026 EPS to CAD5.26 from CAD5.62 and 2027 to CAD6.37 from CAD6.52.