Maintaining a Hold on Empire: Limited Near-Term Catalysts and Uncertain EPS Growth Despite Valuation Discount

Analyst Etienne Ricard from BMO Capital maintained a Hold rating on Empire Co Cl A NV and keeping the price target at C$51.00.

Etienne Ricard has given his Hold rating due to a combination of factors related to Empire’s near‑term earnings visibility and cost execution. While he expects modest gross margin improvement and acknowledges management’s renewed focus on operating leverage, he is cautious about SG&A growth that continues to run ahead of sales and about how quickly cost initiatives like shrink reduction and Voilà profitability can materially support EPS.

Ricard also points out that Empire still trades at a discount to Loblaw and Metro and that narrowing this gap likely requires consistent delivery of 8–11% annual EPS growth, a target for which he does not yet have sufficient confidence. With sales growth muted, tonnage flat, and consumer demand in Canada showing little incremental strength, he sees limited catalysts in the near term, leading him to maintain a neutral, or Hold, stance on the shares.