Pet Valu Holdings Ltd. (PET) AI Stock Analysis

• Market Cap: C$1.95B
• Dividend Yield: 1.7%
• Average Volume (3M): 130.53K
• Price to Earnings (P/E): 20.3
• Beta (1Y): 0.78
• Revenue Growth: 5.09%
• EPS Growth: 14.05%
• Country: CA
• Employees: 2,086
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 0.40
• Shares Outstanding: 68,754,166
• 10 Day Avg. Volume: 75,317
• 30 Day Avg. Volume: 130,528
• PEG Ratio: -6.52
• Price to Book (P/B): 18.89
• Price to Sales (P/S): 1.65
• P/FCF Ratio: 13.56
• 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$37.60
• Price Target Upside: 32.86% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 65 Neutral
• Price Target: C$31.00 ▲(9.54% Upside)

Pet Valu Holdings Ltd. shows strong revenue growth and operational efficiency, but faces challenges with high leverage and modest profitability. Technical indicators suggest a bearish trend, while valuation metrics indicate moderate pricing. The earnings call provided a positive outlook, tempered by economic uncertainties.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, supporting long-term financial health.

Store Network Expansion

Expanding the store network enhances market presence and accessibility, driving future revenue growth and competitive positioning.

Supply Chain Transformation

Improved supply chain efficiency reduces costs and enhances profitability, providing a durable competitive advantage.

Negative Factors

High Leverage

Significant reliance on debt can limit financial flexibility and increase risk, impacting long-term sustainability and growth potential.

Uneven Discretionary Demand

Fluctuating consumer spending on non-essential items can affect sales stability, posing challenges to consistent revenue growth.

Macroeconomic Uncertainty

Economic uncertainty can lead to cautious consumer behavior, impacting sales and profitability in the medium term.

Pet Valu Holdings Ltd. Business Overview & Revenue Model

Company Description

Pet Valu Holdings Ltd. (PET) is a leading Canadian retailer of pet food and pet-related products, specializing in the sale of premium pet supplies and accessories. Operating primarily in the pet retail sector, Pet Valu offers a wide range of products including dog and cat food, treats, toys, grooming supplies, and health products. The company aims to cater to the needs of pet owners by providing high-quality products and expert advice through its network of stores across Canada.

How the Company Makes Money

Pet Valu generates revenue primarily through the sale of pet food and accessories in its retail locations and online platform. The company has a diverse revenue model that includes direct sales from its stores, e-commerce transactions, and various private label products. Key revenue streams include sales of premium pet food brands, grooming products, and pet-related accessories. Additionally, Pet Valu benefits from partnerships with leading pet product manufacturers, allowing them to offer exclusive products and promotions. The growth in pet ownership and the increasing trend of pet humanization contribute positively to its earnings, as consumers are willing to spend more on high-quality products and services for their pets.

Pet Valu Holdings Ltd. Financial Statement Overview

Summary

Pet Valu Holdings Ltd. shows strong revenue growth and profitability, with stable margins and efficient operations. However, high leverage and the need for improved cash flow efficiency are concerns.

Income Statement

Pet Valu Holdings Ltd. demonstrates strong revenue growth with a TTM increase of 1.38%, building on consistent annual growth. Gross profit and net profit margins are stable, with TTM margins at 33.6% and 8.2% respectively. EBIT and EBITDA margins are healthy, indicating efficient operations. However, the slight decline in gross profit margin over the years suggests rising costs or pricing pressures.

Balance Sheet

The company's balance sheet shows high leverage with a TTM debt-to-equity ratio of 7.49, indicating significant reliance on debt financing. Return on equity is strong at 92.5%, reflecting effective use of equity, but the low equity ratio of 5.8% suggests potential financial vulnerability. The improvement in equity over the years is a positive sign, but the high debt levels remain a concern.

Cash Flow

Pet Valu Holdings Ltd. has shown a robust free cash flow growth rate of 20.48% in the TTM, indicating strong cash generation capabilities. The operating cash flow to net income ratio is nearly 1, suggesting good cash conversion. However, the free cash flow to net income ratio of 0.68 indicates room for improvement in cash flow efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.13B	1.10B	1.06B	951.70M	776.01M	648.46M
Gross Profit	379.56M	364.64M	365.14M	352.30M	287.18M	230.63M
EBITDA	241.03M	231.16M	215.41M	203.62M	198.47M	137.54M
Net Income	95.64M	87.42M	89.55M	100.77M	95.36M	28.62M
Balance Sheet
Total Assets	990.74M	970.93M	916.91M	740.18M	599.17M	562.12M
Cash, Cash Equivalents and Short-Term Investments	11.38M	35.14M	28.44M	63.03M	50.07M	71.48M
Total Debt	808.86M	749.29M	737.13M	605.11M	584.41M	923.02M
Total Liabilities	933.23M	875.18M	847.19M	739.80M	693.70M	1.03B
Stockholders Equity	57.50M	95.75M	69.72M	376.00K	-94.52M	-588.53M
Cash Flow
Free Cash Flow	150.59M	133.42M	72.17M	79.11M	109.70M	131.02M
Operating Cash Flow	212.57M	200.08M	135.34M	123.52M	138.16M	152.14M
Investing Cash Flow	-5.97M	-8.52M	-16.15M	-17.32M	3.99M	11.55M
Financing Cash Flow	-218.90M	-183.82M	-153.78M	-92.80M	-163.34M	-135.90M

Pet Valu Holdings Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 28.30
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:PET, the sentiment is Negative. The current price of 28.3 is below the 20-day moving average (MA) of 28.56, below the 50-day MA of 30.71, and below the 200-day MA of 31.44, indicating a bearish trend. The MACD of -0.48 indicates Negative momentum. The RSI at 39.98 is Neutral, neither overbought nor oversold. The STOCH value of 16.72 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:PET.

Pet Valu Holdings Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CTC.A	69 Neutral	C$9.38B	13.05	13.16%	4.10%	-0.13%	13.73%
PET	65 Neutral	C$1.95B	20.34	106.59%	1.70%	5.09%	14.05%
CTC	64 Neutral	C$9.38B	17.34	13.16%	3.09%	-0.13%	13.73%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Pet Valu Holdings Ltd. Corporate Events

Pet Valu Reports Strong Q3 Growth and Strategic Expansion

Pet Valu Holdings Ltd. reported a 2.3% growth in same-store sales and a 5% increase in revenue for the third quarter of 2025. Despite a slight decrease in adjusted EBITDA, the company opened 16 new stores and launched a new distribution center in Calgary, indicating strategic expansion and operational efficiency. The company narrowed its 2025 financial outlook, projecting revenue between $1.175 and $1.185 billion, demonstrating confidence in its growth trajectory. The announcement highlights Pet Valu’s commitment to leveraging supply chain investments and enhancing customer experience, positioning it well for the holiday season and long-term growth.