Key Stats for Petco Stock
- Price Change for $WOOF stock: 24%
- Current Share Price: $3.99
- 52-Week High: $6.29
- $WOOF Stock Price Target: $3.77
What Happened?
Petco Health & Wellness (WOOF) stock surged nearly 24% on Friday following the pet supplies retailer’s surprise second-quarter profit and raised earnings outlook.
In fiscal Q2 (ended in July), Petco reported earnings per share of $0.05, beating analyst expectations for a $0.01 loss. Adjusted EBITDA of $113.9 million also topped forecasts as the company’s turnaround strategy showed tangible benefits.
While revenue fell 2.3% year-over-year to $1.49 billion and comparable store sales dropped 1.4%, both figures were below estimates, management explained that this was expected due to 25 net store closures last year and 10 more so far this year.
Petco’s “Phase 2” transformation strategy prioritizes profitability over growth, intentionally shifting its focus from unprofitable sales to disciplined pricing and enhanced retail execution.
See analysts’ growth forecasts and price targets for Petco stock (It’s free!) >>>
What the Market Is Telling Us About Petco Stock
The rally in WOOF stock reflects investor confidence in CEO Joel Anderson’s turnaround plan, which has delivered meaningful improvements to the bottom line.
Operating income increased by over $40 million year-over-year, while gross margins expanded more than 120 basis points to 39.3%.
Petco raised its full-year adjusted EBITDA guidance to $385-$395 million, up from the previous range of $375-$390 million.
Several analysts raised their price targets following the earnings beat, with Jefferies increasing its target to $4.15 from $4.05 and Wells Fargo raising its target to $4 from $3.50.
The positive response to WOOF stock suggests investors are rewarding the company’s focus on operational improvements and margin expansion, even as it sacrifices near-term sales growth to build a stronger foundation for future profitable growth.
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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!
