Key Stats for Petco Stock
- Price change for Petco stock: 30%
- $WOOF Share Price as of Mar. 12: $4
- 52-Week High: $5
- $WOOF Stock Price Target: $3
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What Happened?
Petco stock (WOOF) surged 55% last week after the company reported stronger-than-expected profitability for fiscal 2025 and surprised investors with a forecast of a return to sales growth in 2026.
For a stock that has been under pressure for years, that combination was enough to spark a major rally.
The full-year numbers were genuinely encouraging.
- Adjusted EBITDA rose 21% to $408 million, exceeding analyst expectations by 3%
- Free cash flow jumped 276% to $187 million.
- Gross margins expanded.
- The company paid down $95 million in debt and
- Petco cut its leverage ratio from 4.2x to 3.0x in a single year.
That is meaningful progress for a business that was carrying a heavy debt load.
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What the Market Is Telling Us About Petco Stock
Petco stock had been one of the most beaten-down names in retail. The 30% jump reflects how low expectations had gotten heading into this report.
The key shift is that management is now pivoting from defense to offense.
CEO Joel Anderson called it Phase III of the turnaround, internally dubbed “Reach for the Sky.”
After two years of cutting costs and cleaning up the balance sheet, the company is now focused on growing sales.
The plan has four pillars.
- First, compelling product, with around 25 new brands and flavors launching this year, and more frequent merchandise resets throughout the store.
- Second, services at scale, leaning into Petco’s wholly owned vet hospitals, grooming, and training as a competitive moat.
- Third, a stronger in-store experience focused on driving traffic and increasing basket size. And
- Fourth, an improved omnichannel model, including a loyalty program relaunch later this year.
One stat from the call stood out.
About half of Petco’s dog customers currently do not buy dog food from the company. That is a significant share-of-wallet opportunity that management is now actively targeting through cross-selling.
For 2026, Petco guided for flat to 1.5% sales growth and Adjusted EBITDA of $415 million to $430 million.
That may not sound dramatic, but for a company that has been intentionally shrinking its top line, even flat growth marks an inflection.
Petco stock still faces real risks.
The balance sheet, while improved, remains leveraged. The macro environment is uncertain. And execution on the growth plan is not guaranteed. But today’s move shows investors are willing to give management the benefit of the doubt after a year of delivering on its promises.
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How Much Upside Does Petco Stock Have From Here?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
