Metro Inc. (MRU) AI Stock Analysis

• Market Cap: C$20.40B
• Dividend Yield: 1.5%
• Average Volume (3M): 609.21K
• Price to Earnings (P/E): 21.1
• Beta (1Y): 0.35
• Revenue Growth: 3.71%
• EPS Growth: 12.40%
• Country: CA
• Employees: 97,870
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Grocery Stores
• EPS (TTM): 1.16
• Shares Outstanding: 213,301,560
• 10 Day Avg. Volume: 587,217
• 30 Day Avg. Volume: 609,212
• PEG Ratio: 1.60
• Price to Book (P/B): 2.91
• Price to Sales (P/S): 0.93
• P/FCF Ratio: 17.62
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$105.50
• Price Target Upside: 10.33% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: C$98.00 ▲(2.49% Upside)

The score is driven mainly by strong, stable financial performance and a constructive earnings outlook with continued investment and shareholder returns. These positives are tempered by clearly bearish technical signals and only moderate valuation support at a ~20.5 P/E with a ~1.63% yield.

Positive Factors

Steady revenue growth and stable margins

Consistent topline growth with near-20% gross margins and mid-single-digit net margins indicates resilient, repeatable grocery and pharmacy demand. This stability supports predictable earnings, operational planning and reinvestment over the medium term, reducing cyclicality risk.

Strong absolute cash generation

Substantial operating and free cash flow provide durable funding for capex, network investments, dividends and buybacks. High absolute cash generation enhances financial flexibility, enabling the company to fund growth initiatives and shareholder returns without relying solely on external financing.

Disciplined capital allocation and shareholder returns

A long track record of dividend increases plus active buybacks reflects management confidence in cash flows and disciplined capital priorities. This consistency supports investor trust, signals sustainable free cash deployment, and aligns incentives toward steady long-term value creation.

Negative Factors

Elevated and rising debt levels

An increase in total debt reduces balance sheet flexibility and raises interest exposure, constraining the company's ability to pursue opportunistic investments or absorb cost shocks. If margins compress or rates rise, higher leverage could force tradeoffs between growth, buybacks and dividends.

Weaker cash conversion and volatile FCF growth

Declining cash conversion and a turn to negative FCF growth signal lower earnings quality and less internally available capital. Over months this can limit reinvestment, slow rollout of initiatives, or increase reliance on borrowing, amplifying execution risk under higher leverage.

Pharmacy margin uncertainty from GLP-1 genericization

Earlier-than-expected generic entry for high-margin GLP-1 therapies could materially alter pharmacy mix and compress margins, reducing a growth engine for front-store and prescription profitability. This structural change would require strategic adjustments to pricing, sourcing and services.

Metro Inc. Business Overview & Revenue Model

Company Description

Metro Inc. operates as a retailer, franchisor, distributor, and manufacturer in the food and pharmaceutical sectors in Canada. It operates supermarkets and discount stores that provide fresh and grocery products, baked goods, prepared foods, meats, dairy products, fruits and vegetables, frozen foods, bakery products, and pastries, as well as Mediterranean and Middle Eastern products. As of September 25, 2021, the company operated a network of approximately 963 food stores under various banners, including Metro, Metro Plus, Super C, and Food Basics, Adonis, and Premiere Moisson as well as approximately 649 drugstores primarily under the Jean Coutu, Brunet, Metro Pharmacy, and Food Basics Pharmacy banners. It also manufactures generic drugs; and provides online grocery shopping services. Metro Inc. was founded in 1947 and is headquartered in Montréal, Canada.

How the Company Makes Money

Metro Inc. generates revenue primarily through the sale of food and grocery products in its supermarkets and stores. The company's revenue model is based on a traditional retail framework, where it purchases products from suppliers at wholesale prices and sells them to consumers at retail prices, earning a margin on each sale. Key revenue streams include fresh food, packaged goods, and non-food items. Additionally, Metro Inc. benefits from private label products, which offer higher margins compared to branded products. The company also engages in promotional activities and loyalty programs to drive customer retention and increase sales. Significant partnerships with local suppliers and distributors enhance its product offerings and support its commitment to local sourcing, which helps attract customers and contribute to overall earnings.

Metro Inc. Financial Statement Overview

Summary

Solid, defensive fundamentals: steady revenue growth to ~$22.2B TTM with stable profitability (TTM gross margin ~19.9%, EBIT margin ~6.7%, net margin ~4.6%). Balance sheet leverage is moderate (debt-to-equity ~0.65) with attractive ROE (~13.9%), but total debt stepped up in the latest TTM snapshot. Cash generation remains strong (TTM FCF ~$1.14B), though cash conversion softened (OCF and FCF below net income) and recent FCF growth turned negative.

Income Statement

Metro shows steady top-line momentum, with revenue rising from ~$18.3B (2021) to ~$22.0B (2025 annual) and ~$22.2B in TTM (Trailing-Twelve-Months). Profitability is solid and fairly stable for the sector: gross margin is ~19.9% and net margin is ~4.6% in TTM, with EBIT margin ~6.7%. Strengths include consistent earnings power and resilient margins; the main weakness is that margins have not meaningfully expanded over time and growth appears to be moderating versus the stronger jump seen in 2023.

Balance Sheet

The balance sheet looks healthy with equity around ~$7.0B and total assets ~$14.9B in TTM (Trailing-Twelve-Months). Leverage is moderate: debt-to-equity sits around ~0.65 in TTM, down from the higher level seen in 2021 (~0.71), and returns on equity are attractive (~13.9% TTM), supporting the quality of earnings. The key risk is debt levels have moved higher in the latest TTM snapshot (total debt ~$6.26B vs ~$4.60B in the 2025 annual), which could reduce flexibility if costs rise or growth slows.

Cash Flow

Cash generation is a clear strength, with operating cash flow at ~$1.56B and free cash flow at ~$1.14B in TTM (Trailing-Twelve-Months). However, cash conversion has softened: operating cash flow is below net income in TTM (coverage ~0.79) and free cash flow is also below net income (about ~0.72x). Free cash flow growth is volatile, turning negative in TTM after positive growth in the 2025 annual period, which is the main watch item despite still-strong absolute cash flow.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	22.01B	21.22B	20.72B	18.89B	18.28B
Gross Profit	4.37B	4.18B	4.08B	3.78B	3.65B
EBITDA	2.08B	1.99B	2.00B	1.79B	1.74B
Net Income	1.02B	928.80M	1.01B	846.10M	823.00M
Balance Sheet
Total Assets	14.54B	14.14B	13.87B	13.40B	13.59B
Cash, Cash Equivalents and Short-Term Investments	67.30M	29.40M	29.50M	13.40M	445.80M
Total Debt	4.60B	4.31B	4.32B	4.12B	4.56B
Total Liabilities	7.49B	7.10B	7.05B	6.78B	7.18B
Stockholders Equity	7.03B	7.02B	6.80B	6.60B	6.40B
Cash Flow
Free Cash Flow	1.16B	1.06B	867.60M	847.80M	969.90M
Operating Cash Flow	1.61B	1.56B	1.46B	1.37B	1.49B
Investing Cash Flow	-424.00M	-471.50M	-586.90M	-492.70M	-487.30M
Financing Cash Flow	-1.15B	-1.09B	-861.80M	-1.31B	-998.30M

Metro Inc. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 95.62
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:MRU, the sentiment is Neutral. The current price of 95.62 is below the 20-day moving average (MA) of 96.22, below the 50-day MA of 97.95, and below the 200-day MA of 99.50, indicating a bearish trend. The MACD of -1.34 indicates Positive momentum. The RSI at 48.71 is Neutral, neither overbought nor oversold. The STOCH value of 50.55 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:MRU.

Metro Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
L	76 Outperform	$79.14B	32.36	21.51%	1.52%	4.21%	14.03%
WN	70 Outperform	C$38.95B	26.83	26.36%	1.23%	4.15%	149.50%
NWC	69 Neutral	C$2.51B	17.57	18.69%	3.27%	2.08%	9.31%
EMP.A	68 Neutral	C$11.09B	16.44	12.66%	1.78%	2.58%	7.85%
MRU	66 Neutral	C$20.40B	21.13	14.48%	1.50%	3.71%	12.40%
DOL	64 Neutral	C$53.47B	41.38	102.01%	0.20%	14.02%	20.11%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%

Metro Inc. Corporate Events

Metro Shareholders Re-Elect Full Slate of Directors at 2026 Annual Meeting

Metro Inc. announced that all 11 management-nominated directors were elected to its board at the company’s January 27, 2026 annual general meeting of shareholders, each securing strong majority support in the votes cast. The reaffirmation of the full slate of directors underscores shareholder confidence in the company’s current leadership and strategic direction as it continues to consolidate its position as a major food and pharmacy player in Québec and Ontario, with implications for continuity in governance and stability for investors, employees and other stakeholders.

The most recent analyst rating on (TSE:MRU) stock is a Buy with a C$111.00 price target. To see the full list of analyst forecasts on Metro Inc. stock, see the TSE:MRU Stock Forecast page.

Metro Posts Higher Sales and Adjusted Earnings Despite Distribution Centre Shutdown

Metro Inc. reported first-quarter fiscal 2026 sales of $5.29 billion, up 3.3% year over year, driven by food same-store sales growth of 1.6% (1.9% adjusted for the Christmas shift), a 25.8% surge in online food sales, and pharmacy same-store sales up 3.9%. Net earnings fell 12.8% to $226.3 million, largely due to $21.6 million in direct costs linked to the temporary shutdown of its frozen food distribution centre in Toronto, but adjusted net earnings rose 1.3% to $248.7 million and adjusted EPS increased 5.5% to $1.16, indicating underlying earnings resilience. Operating income before depreciation and amortization was essentially flat at $482.6 million, with gross margin steady at 19.7% and operating expenses slightly higher as a share of sales because of the distribution centre disruption; excluding these exceptional costs, expense ratios would have improved. The company highlighted market share gains, strong performance of new discount stores and robust online growth despite persistent food inflation and operational challenges, and it raised its quarterly dividend by 10.1%, signaling confidence in its long-term growth strategy and financial strength.

The most recent analyst rating on (TSE:MRU) stock is a Buy with a C$115.00 price target. To see the full list of analyst forecasts on Metro Inc. stock, see the TSE:MRU Stock Forecast page.

METRO Inc. Sets January 27 Date to Unveil Fiscal 2026 First-Quarter Results

METRO Inc. announced it will publish its fiscal 2026 first-quarter results on January 27, 2026, followed by a conference call for investors and financial analysts hosted by President and CEO Eric R. La Flèche and Executive Vice President and CFO Nicolas Amyot. The call, which will include a question period for the financial community and listen-only access for journalists and the public, underscores the company’s continued emphasis on transparent communication with capital markets and stakeholders ahead of a key financial update for one of Canada’s largest food and pharmacy retailers.

The most recent analyst rating on (TSE:MRU) stock is a Buy with a C$113.00 price target. To see the full list of analyst forecasts on Metro Inc. stock, see the TSE:MRU Stock Forecast page.

METRO Inc. Sets Date for Fiscal 2026 First-Quarter Results and Investor Call

METRO Inc. announced that it will release its fiscal 2026 first-quarter results on January 27, 2026, followed by a conference call led by President and CEO Eric R. La Flèche and Executive Vice President and CFO Nicolas Amyot for investors and financial analysts, with a subsequent question period. The call, which will also be accessible in listen-only mode to journalists and the public and available as a replay until late February, underscores the company’s ongoing engagement with the financial community and offers stakeholders timely insight into its early 2026 performance in the competitive food and pharmacy retail market in Eastern Canada.

The most recent analyst rating on (TSE:MRU) stock is a Buy with a C$113.00 price target. To see the full list of analyst forecasts on Metro Inc. stock, see the TSE:MRU Stock Forecast page.

Metro Inc. Reports Growth in Fourth Quarter and Fiscal 2025 Results

Metro Inc. reported a 3.4% increase in sales for the fourth quarter of Fiscal 2025, reaching $5,108.7 million, with food and pharmacy same-store sales rising by 1.6% and 4.8%, respectively. Despite a temporary shutdown of its frozen food distribution center in Toronto, which negatively impacted net earnings by $22.5 million, the company achieved a 10.8% growth in adjusted fully diluted net earnings per share. For the fiscal year, sales grew by 3.7% to $22,006.7 million, and net earnings increased by 9.4% to $1,019.5 million. The company successfully opened new stores and converted others, aiming to continue its growth through strategic investments and strong execution.

The most recent analyst rating on (TSE:MRU) stock is a Buy with a C$110.00 price target. To see the full list of analyst forecasts on Metro Inc. stock, see the TSE:MRU Stock Forecast page.