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Empire Co Cl A NV (TSE:EMP.A)
TSX:EMP.A
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Empire Co Cl A NV (EMP.A) AI Stock Analysis

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TSE:EMP.A

Empire Co Cl A NV

(TSX:EMP.A)

Rating:80Outperform
Price Target:
C$64.00
â–²(14.96%Upside)
Empire Co Cl A NV scores highly due to its strong financial performance, effective management strategies, and positive market momentum. The bullish technical indicators and strategic corporate actions, such as dividend increases and share buybacks, further support the stock's favorable outlook. However, the valuation is a bit stretched, suggesting careful consideration for entry points.
Positive Factors
Earnings Growth
FQ4/25 was a better SG&A result than historical trends, which is a key component to drive consistent 8-11% EPS growth.
Stock Performance
Empire continues to trade at a wider-than-historical discount to Loblaw and MRU, but the stock's absolute return has been very strong over the past 1.5 years.
Store Expansion
The company plans to open 24 new store locations, which is expected to contribute to sales growth.
Negative Factors
Comparative Performance
There is hesitation to assume further sequential acceleration in same-store sales due to lapping stronger comparisons.
Operational Expenses
Operating expenses, specifically SG&A, are anticipated to grow year-over-year due to increased stock-based compensation.
Sales Trends
There is concern that the 'Buy Canadian' trend may be subsiding, which could affect future sales.

Empire Co Cl A NV (EMP.A) vs. iShares MSCI Canada ETF (EWC)

Empire Co Cl A NV Business Overview & Revenue Model

Company DescriptionEmpire Company Limited (EMP.A) is one of Canada's leading food retailers, primarily operating through its wholly-owned subsidiary, Sobeys Inc. The company is headquartered in Stellarton, Nova Scotia, and operates a network of over 1,500 stores across Canada under various banners including Sobeys, Safeway, IGA, Foodland, FreshCo, Farm Boy, and more. Empire also owns a significant real estate portfolio through its subsidiary Crombie REIT, which manages properties leased to retail tenants. Empire's core services include food retailing, pharmacy operations, and real estate investments, making it a major player in the Canadian grocery and real estate sectors.
How the Company Makes MoneyEmpire Company Limited generates revenue primarily through its grocery retail operations. The company earns money by selling food, pharmacy, and other consumer products across its vast network of stores under multiple banners. Its key revenue streams include in-store sales, pharmacy services, and online grocery shopping platforms. Empire also benefits from its real estate investments, where it collects rental income from properties leased to various tenants, including its own retail stores. Strategic partnerships with suppliers, effective supply chain management, and a customer-centric approach contribute to Empire's ability to maintain competitive pricing and customer loyalty. Additionally, Empire has been investing in digital transformations and e-commerce to enhance its online presence and adapt to changing consumer buying habits, which further supports its revenue growth.

Empire Co Cl A NV Earnings Call Summary

Earnings Call Date:Jun 19, 2025
(Q4-2025)
|
% Change Since: 7.68%|
Next Earnings Date:Sep 11, 2025
Earnings Call Sentiment Positive
Empire reported strong financial performance with significant EPS and same-store sales growth. The company has effectively managed inflation and capital allocation. However, increased SG&A expenses due to non-cash compensation costs were a notable concern.
Q4-2025 Updates
Positive Updates
Strong EPS Growth
Empire delivered an EPS of $0.74 in Q4, translating to a 17.5% year-over-year growth. Adjusted EPS grew by 8.8% annually, within the long-term framework of 8% to 11% growth.
Same-Store Sales Growth
The company reported a strong same-store sales growth of 3.8%, marking the fourth consecutive quarter of sequential growth.
Market Share Gains
Empire gained market share, with increased customer behavior trends favoring Canadian retailers over U.S. ones.
Dividend Increase
Empire announced a 10% increase in its quarterly dividend per share, marking the 30th consecutive year of dividend growth.
Canadian Product Preference
Empire's focus on Canadian products has resonated with customers, contributing to increased sales of Canadian products.
Negative Updates
Increased SG&A Expenses
SG&A expenses were elevated due to higher share-based compensation expenses, mostly driven by an increase in share price, impacting EPS by $0.15.
High Non-Cash Compensation Costs
A significant increase in total compensation expenses of $49 million compared to last year due to non-cash accounting related to stock price growth.
Company Guidance
During the Empire Fourth Quarter 2025 Conference Call, several key metrics were highlighted, showcasing the company's strong performance. Empire reported an EPS of $0.74 for the quarter, marking a substantial 17.5% year-over-year growth. The company achieved a same-store sales growth of 3.8%, driven by the strengthened performance of both Full-Service and discount banners. Empire also demonstrated effective gross margin management, with an improvement of 32 basis points, exceeding the medium-term expectations of a 10 to 20 basis point increase per year. The company's adjusted EPS for the fiscal year grew by 8.8%, aligning with its financial framework goal of 8% to 11% growth annually. Additionally, Empire announced a 10% increase in its quarterly dividend, maintaining a consistent 10.8% CAGR over five years, and renewed its NCIB to repurchase up to 11.5 million shares in fiscal 2026. The company plans to invest $850 million in capital expenditure, focusing on expanding its store network with 24 new stores projected for fiscal 2026.

Empire Co Cl A NV Financial Statement Overview

Summary
Empire Co Cl A NV shows solid financial performance with consistent revenue and profit growth, stable margins, and strong cash flows. The company's balanced capital structure and effective cash management practices are notable. However, leverage is slightly above optimal levels, suggesting room for improvement.
Income Statement
85
Very Positive
Empire Co Cl A NV has demonstrated consistent revenue growth over the years, with a revenue increase from $30.2 billion in 2022 to $31.3 billion in 2025, reflecting a solid growth trajectory. The gross profit margin and net profit margin are stable, with the gross margin at approximately 27% and net margin at around 2.2% for the latest year. EBIT and EBITDA margins have shown resilience, maintaining healthy levels above 4% and 7% respectively. These metrics indicate strong operational efficiency and profitability in a competitive industry.
Balance Sheet
75
Positive
The company's balance sheet shows a steady increase in stockholders' equity from $4.37 billion in 2021 to $5.41 billion in 2025, indicating strong equity growth. The debt-to-equity ratio remains relatively high at approximately 1.38 in the latest year, suggesting moderate leverage, which is typical in the grocery industry. Return on Equity (ROE) remains stable around 13%, suggesting efficient use of equity capital. The equity ratio is around 32%, indicating a balanced capital structure with room for improvement in reducing leverage.
Cash Flow
80
Positive
Empire Co Cl A NV maintains a strong cash flow position, with operating cash flow growing from $1.86 billion in 2021 to $2.13 billion in 2025. Free cash flow has shown positive growth, with a notable increase from $0.85 billion in 2023 to $1.35 billion in 2025, emphasizing efficient capital expenditure management. The operating cash flow to net income ratio is robust, reflecting healthy cash generation relative to earnings. The company demonstrates effective cash management practices, crucial for sustaining operations and growth.
BreakdownJun 2025Jun 2024Jun 2023Jun 2022Jun 2021
Income Statement
Total Revenue31.28B30.73B30.48B30.16B28.27B
Gross Profit8.38B8.07B7.79B7.66B7.20B
EBITDA2.44B2.40B2.28B2.35B2.17B
Net Income700.00M725.20M686.00M745.80M701.50M
Balance Sheet
Total Assets17.02B16.79B16.48B16.59B15.17B
Cash, Cash Equivalents and Short-Term Investments285.00M259.60M221.30M812.30M890.50M
Total Debt7.46B7.36B7.27B7.46B7.13B
Total Liabilities11.47B11.32B11.15B11.46B10.68B
Stockholders Equity5.41B5.34B5.20B4.99B4.37B
Cash Flow
Free Cash Flow1.35B1.28B847.60M1.33B1.20B
Operating Cash Flow2.13B2.07B1.61B2.11B1.86B
Investing Cash Flow-597.00M-608.50M-684.70M-891.40M-502.30M
Financing Cash Flow-1.50B-1.43B-1.51B-1.29B-1.48B

Empire Co Cl A NV Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price55.67
Price Trends
50DMA
53.45
Positive
100DMA
50.35
Positive
200DMA
46.15
Positive
Market Momentum
MACD
0.57
Positive
RSI
49.10
Neutral
STOCH
21.90
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:EMP.A, the sentiment is Neutral. The current price of 55.67 is below the 20-day moving average (MA) of 55.76, above the 50-day MA of 53.45, and above the 200-day MA of 46.15, indicating a neutral trend. The MACD of 0.57 indicates Positive momentum. The RSI at 49.10 is Neutral, neither overbought nor oversold. The STOCH value of 21.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:EMP.A.

Empire Co Cl A NV Peers Comparison

Overall Rating
UnderperformOutperform
Sector (53)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
80
Outperform
C$12.71B18.6413.02%1.50%1.77%0.77%
78
Outperform
C$66.34B29.9821.77%0.97%3.26%22.09%
76
Outperform
C$33.61B29.4819.58%1.27%2.36%-6.97%
76
Outperform
C$22.65B23.2514.26%1.36%2.31%4.45%
70
Outperform
C$11.87B42.30-2.51%2.65%9.91%-165.83%
65
Neutral
C$2.22B16.2118.85%3.46%4.19%2.56%
53
Neutral
C$4.45B4.20-20.57%3.55%8.21%2.02%
* Consumer Defensive Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:EMP.A
Empire Co Cl A NV
55.67
19.68
54.68%
TSE:L
Loblaw Companies
222.34
55.42
33.20%
TSE:MRU
Metro Inc.
105.24
24.35
30.10%
TSE:WN
George Weston
263.85
53.32
25.33%
TSE:NWC
North West
46.24
2.48
5.67%
TSE:SAP
Saputo Inc.
28.69
-2.11
-6.85%

Empire Co Cl A NV Corporate Events

Stock BuybackDividendsFinancial Disclosures
Empire Company Limited Reports Strong Fiscal 2025 Results and Announces Shareholder Returns
Positive
Jun 19, 2025

Empire Company Limited reported strong financial results for the fourth quarter and fiscal year 2025, with earnings per share increasing to $0.74 from $0.61 the previous year. The company saw a 3.0% increase in sales to $7,637 million and same-store sales growth of 3.8%. Empire also announced a 10% dividend increase, marking the 30th consecutive year of dividend growth, and plans to repurchase up to $400 million in shares in fiscal 2026. These actions reflect Empire’s robust financial health and commitment to returning value to shareholders, positioning the company well within the competitive retail market.

The most recent analyst rating on ($TSE:EMP.A) stock is a Buy with a C$40.00 price target. To see the full list of analyst forecasts on Empire Co Cl A NV stock, see the TSE:EMP.A Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 08, 2025