Central Garden Pet (CENT) AI Stock Analysis

• Market Cap: $1.86B
• Dividend Yield: N/A
• Average Volume (3M): 83.07K
• Price to Earnings (P/E): 14.6
• Beta (1Y): 0.49
• Revenue Growth: -4.90%
• EPS Growth: 0.29%
• Country: US
• Employees: 6,000
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Packaged Foods
• EPS (TTM): 1.56
• Shares Outstanding: 9,650,221
• 10 Day Avg. Volume: 73,286
• 30 Day Avg. Volume: 83,071
• PEG Ratio: -0.74
• Price to Book (P/B): 1.55
• Price to Sales (P/S): 0.75
• P/FCF Ratio: 6.85
• Enterprise Value/Market Cap: 1.57
• Enterprise Value/Revenue: 0.94
• Enterprise Value/Gross Profit: 3.02
• Enterprise Value/Ebitda: 9.05
• 1Y Price Target: $40.00
• Price Target Upside: 29.70% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 67 Neutral
• Price Target: $34.00 ▲(10.25% Upside)

Central Garden Pet's overall stock score reflects strong profitability and operational efficiency, as highlighted in the earnings call. However, the bearish technical indicators and challenges in revenue growth and cash flow weigh on the score. The reasonable valuation and strategic initiatives provide some support, but careful management is needed to navigate macroeconomic challenges.

Positive Factors

Margin Expansion

Margin expansion indicates strong cost management and operational efficiency, which can enhance profitability and provide a buffer against revenue fluctuations.

E-commerce and Innovation Growth

Growth in e-commerce and product innovation can drive long-term revenue by capturing new market segments and adapting to consumer trends.

Strong Garden Segment Performance

The Garden segment's strong performance and margin expansion reflect robust demand and effective cost management, supporting overall business stability.

Negative Factors

Decline in Pet Segment Sales

Declining sales in the Pet segment may indicate challenges in maintaining market share and could impact overall revenue growth if not addressed.

Impact of Tariffs

Tariff-related pressures can increase costs and reduce margins, potentially affecting the company's competitive position and profitability in the long term.

Challenging Weather Conditions

Adverse weather conditions can disrupt sales in the Garden segment, highlighting vulnerability to external factors that could impact future revenue stability.

Central Garden Pet Business Overview & Revenue Model

Company Description

Central Garden & Pet Company (CENT) is a leading provider of products and services for the lawn and garden, and pet supplies sectors. The company operates through two main segments: the Garden segment, which offers a wide range of products including seeds, fertilizers, and pest control solutions, and the Pet segment, which provides pet food, treats, and supplies for various types of pets. Central Garden & Pet focuses on enhancing the lives of pets and their owners, as well as the beauty and productivity of outdoor spaces.

How the Company Makes Money

Central Garden & Pet generates revenue primarily through the sale of its diverse product offerings in both the Garden and Pet segments. The company sells its products through various channels, including retail stores, e-commerce platforms, and direct sales to consumers. Key revenue streams include sales of pet food and treats, lawn care products, and garden supplies. Additionally, Central Garden & Pet benefits from strategic partnerships with major retailers, which help to expand its distribution network and increase market penetration. The company's focus on innovation and brand development, along with its ability to adapt to market trends, further contributes to its overall earnings.

Central Garden Pet Financial Statement Overview

Summary

Central Garden Pet demonstrates strong profitability and operational efficiency, with improved margins and return on equity. However, challenges include declining revenue and negative free cash flow growth. The balance sheet remains stable with moderate leverage, but careful management is required to mitigate potential risks.

Income Statement

Central Garden Pet shows a stable gross profit margin of around 31% in the TTM, indicating efficient cost management. However, the company faces challenges with a negative revenue growth rate of -1.12% in the TTM, reflecting declining sales. The net profit margin has improved to 4.44% in the TTM, suggesting better profitability. EBIT and EBITDA margins have also improved, indicating operational efficiency. Overall, the income statement reflects a mixed performance with strong profitability but declining revenue.

Balance Sheet

The company's debt-to-equity ratio of 0.90 in the TTM indicates a moderate level of leverage, which is manageable. Return on equity has improved to 8.93% in the TTM, showing effective use of equity to generate profits. The equity ratio of 44.16% suggests a solid equity base relative to total assets. While the balance sheet shows stability, the moderate leverage poses a potential risk if not managed carefully.

Cash Flow

Central Garden Pet's free cash flow growth rate is negative at -6.26% in the TTM, indicating challenges in generating cash. The operating cash flow to net income ratio of 2.55 suggests strong cash generation relative to net income. The free cash flow to net income ratio of 0.88 indicates that a significant portion of net income is converted into free cash flow. Despite the negative growth in free cash flow, the company maintains a healthy cash conversion, reflecting efficient cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.12B	3.20B	3.31B	3.34B	3.30B	2.70B
Gross Profit	969.74M	943.74M	946.84M	992.30M	970.90M	796.56M
EBITDA	323.26M	290.76M	307.17M	340.98M	329.22M	253.34M
Net Income	138.49M	107.98M	125.64M	152.15M	151.75M	120.68M
Balance Sheet
Total Assets	3.60B	3.55B	3.38B	3.28B	3.12B	2.34B
Cash, Cash Equivalents and Short-Term Investments	713.05M	753.55M	488.73M	177.44M	426.42M	652.71M
Total Debt	1.44B	1.42B	1.37B	1.38B	1.36B	814.06M
Total Liabilities	2.07B	2.00B	1.93B	1.95B	1.89B	1.26B
Stockholders Equity	1.59B	1.56B	1.45B	1.33B	1.22B	1.08B
Cash Flow
Free Cash Flow	312.25M	351.76M	327.67M	-149.24M	170.51M	221.22M
Operating Cash Flow	352.87M	394.89M	381.63M	-34.03M	250.84M	264.27M
Investing Cash Flow	-44.65M	-105.19M	-34.58M	-142.98M	-899.36M	-48.11M
Financing Cash Flow	-165.71M	-25.44M	-37.55M	-66.81M	420.48M	-60.56M

Central Garden Pet Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 30.84
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CENT, the sentiment is Neutral. The current price of 30.84 is below the 20-day moving average (MA) of 30.98, below the 50-day MA of 33.85, and below the 200-day MA of 35.77, indicating a neutral trend. The MACD of -0.78 indicates Negative momentum. The RSI at 50.86 is Neutral, neither overbought nor oversold. The STOCH value of 96.19 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CENT.

Central Garden Pet Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CENT	67 Neutral	$1.86B	14.59	8.70%	―	-4.90%	0.29%
JJSF	67 Neutral	$1.77B	21.21	8.79%	3.45%	0.50%	-4.46%
SMPL	63 Neutral	$2.04B	19.90	5.86%	―	8.98%	-26.29%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
FRPT	60 Neutral	$2.64B	81.83	3.26%	―	19.30%	33.65%
KLG	57 Neutral	―	―	―	―	-4.30%	-70.31%
HLF	56 Neutral	$859.90M	2.62	―	―	-2.25%	288.79%

Central Garden Pet Corporate Events

Central Garden & Pet’s Earnings Call Highlights Achievements and Challenges

Central Garden & Pet’s recent earnings call reflected a balanced sentiment, highlighting both achievements and challenges. The company celebrated record earnings and strategic advancements in its Pet segment, while also acknowledging hurdles such as declining net sales and adverse weather impacts on its Garden segment. Despite these obstacles, Central Garden & Pet remains optimistic about its strategic direction and future growth prospects.

Central Garden & Pet Reports Strong Q3 Earnings

Central Garden & Pet Company, a prominent player in the pet and garden industries, is known for its innovative products aimed at enhancing the quality of home environments. The company recently released its third-quarter financial results for fiscal 2025, showcasing a strong performance despite challenging market conditions.