Analyst Tamy Chen from BMO Capital reiterated a Hold rating on Loblaw Companies and increased the price target to C$230.00 from C$220.00.
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Tamy Chen’s rating is based on a combination of factors influencing Loblaw Companies’ current and future performance. Although the company has shown strong momentum in the first half of 2025, and management has reiterated its guidance for the year, there is an expectation that this guidance might be revised upwards with the next quarter’s reporting. Despite this potential for growth, the company is trading at a premium compared to its peers, which suggests that the stock may not currently offer the best entry point for investors.
Another factor considered is the impact of generic alternatives to branded specialty drugs like Ozempic, which could affect Loblaw’s pharmacy segment. While these generics are expected to have a lower price, they may offer higher gross margins, potentially benefiting Loblaw in the long run. Additionally, the ongoing trend towards discount grocery and the ‘Buy Canadian’ movement are areas of interest, as they could influence Loblaw’s market position. Given these mixed factors, a Hold rating reflects a balanced view of the potential risks and opportunities facing the company.
LBLCF’s price has also changed moderately for the past six months – from $130.820 to $163.190, which is a 24.74% increase.