In a move that will likely leave you wondering just what supermarket chain Metro (TSE:MRU) shareholders wanted from it, anyway, it posted earnings, and had a pretty good run of it too. But shareholders were unfathomably displeased, and sent Metro shares down nearly 4% in Tuesday morning’s trading.
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Out of the gate, Metro posted a pretty substantial win. It reported first quarter profit of $259.5 million, which blew away the $228.5 million posted from the first quarter of 2024. Metro also recorded a per-share profit of $1.16, which was again up, and quite well, from the $0.99 per share the same time a year prior.
Metro even hiked its dividend substantially, going up from $0.335 to $0.37 every quarter. Raw sales for the quarter came in at $5.12 billion against a year prior’s $4.97 billion. Same-store food sales notched up 1% against last year’s figures, and were actually up 2.4% after adjusting for a slightly different Christmas shopping season. Pharmacy sales surged, up 5.1%, and prescription drug sales were up 7.3%, suggesting that more shoppers are turning to Metro locations to fill prescriptions.
Where the Tariffs May Hit
The ongoing and very real potential of tariffs between the United States and Canada, meanwhile, is leaving everyone just a little concerned about what prices will surge this time, and by how much. Metro locations may find themselves in line for some tariff hits as well, reports noted.
Carleton University’s co-chair of the Expert Group on Canada-U.S. Relations, Fen Osler Hampson, noted that “breakfast cereal” would certainly take a major upward surge. With the United States a big cereal exporter, and Canada its main destination, those magical Lucky Charms may soon look like a pot of gold. Soap, cosmetics products, and fruit juice would also surge under tariff plans.
Is Metro Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on TSE:MRU stock based on two Buys and five Holds assigned in the past three months, as indicated by the graphic below. After an 26.39% rally in its share price over the past year, the average TSE:MRU price target of C$94.57 per share implies 7.47% upside potential.
