Analyst Steven Zaccone from Citi maintained a Hold rating on Valvoline (VVV – Research Report) and decreased the price target to $38.00 from $41.00.
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Steven Zaccone has given his Hold rating due to a combination of factors influencing Valvoline’s current market position. The company’s upcoming earnings report is anticipated to align with market expectations, but there are concerns about its EBITDA and EPS performance, which are projected to be slightly below the consensus. Despite the defensive nature of the auto parts retail sector, Valvoline’s stock has not demonstrated the same resilience as its peers, raising questions about its ability to withstand potential consumer spending downturns.
Additionally, there are several uncertainties that need to be addressed, such as the impact of tariffs on pricing, the competitive landscape if consumer spending weakens, and the company’s unit growth plans amidst rising labor costs. The announcement of a new CFO and updates on the Breeze Autocare acquisition are also awaited. These factors contribute to a cautious outlook, justifying the Hold rating until more clarity is provided on these issues.
Based on the recent corporate insider activity of 35 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of VVV in relation to earlier this year.