Petco Health: RBC Capital Reiterates Outperform, Raises PT to $4 from $4

Petco Health: RBC Capital Reiterates Outperform, Raises PT to $4 from $4

RBC Capital Markets has reiterated its Outperform rating on Petco Health & Wellness Co. Inc. (NASDAQ: WOOF) while raising its price target to $4.00 from $4.00. This update comes following the company's second-quarter financial results, which showcased "solid profit delivery" despite the absence of top-line growth or macroeconomic improvement [1].

The research firm highlighted Petco's first-half performance as demonstrating "encouraging" early signs of stabilization. RBC Capital noted that continued similar performance in upcoming quarters could put the business "on better footing," but emphasized that "there is still stabilization work to do." The firm indicated that improved business stability would ease Petco’s transition to a more offensive growth strategy [1].

Petco Health & Wellness Company Inc. reported its second-quarter earnings for fiscal year 2025, exceeding Wall Street’s expectations. The company posted an earnings per share (EPS) of $0.05, which was significantly higher than the projected $0.01. Petco’s revenue for the quarter reached $1.5 billion, slightly surpassing analyst projections. Following the announcement, Petco’s stock price increased by 0.94% to $3.23 in after-hours trading [2].

Despite these positive developments, Petco has yet to achieve a return to growth. These recent updates reflect the company’s ongoing efforts to improve its financial performance and market position. UBS raised its price target for Petco to $3.70 from $3.25, while maintaining a Neutral rating. UBS highlighted the company’s progress in its turnaround efforts, which has bolstered market confidence [1].

Petco Health & Wellness Company Inc. continues to face challenges in stabilizing its business and achieving growth. However, the recent earnings results and analyst upgrades suggest that the company is making progress in its turnaround efforts. Investors should closely monitor Petco's future earnings reports and strategic initiatives to gauge its long-term prospects.

References:
[1] https://www.investing.com/news/analyst-ratings/jefferies-raises-petco-stock-price-target-to-415-on-solid-profit-delivery-93CH-4216842
[2] https://www.investing.com/news/transcripts/earnings-call-transcript-petco-q2-2025-beats-eps-expectations-stock-rises-93CH-4215673