Petco Heath & Wellness Co. Inc. (WOOF) PT Raised to $4 at Citi

Citi analyst Steven Zaccone raised the price target on Petco Heath & Wellness Co. Inc. (NASDAQ: WOOF) to $4.00 (from $3.00) while maintaining a Neutral rating.

The analyst comments "WOOF will report 1Q earnings on June 5th. WOOF is a turnaround story that should trade on EBITDA performance. New CFO Simmons expressed confidence in managing costs across the P&L on her first earnings call on 3/26. The pet industry landscape has been mixed, but high frequency data (i.e., store traffic and credit card data) suggest improving trends in April. This likely bodes well for WOOF’s top-line putting up a modest beat on 1Q SSS. We believe EBITDA should also beat as vendor negotiation efforts put in place last year should benefit gross margin, while the new CFO should ensure flow-through to the bottom-line. The business will eventually need to enter “phase three” or return to revenue growth, but one step at a time is all that matters right now. We open a 90-day positive short-term view. Stay Neutral. Raise our TP to $4 based on 5x FY26 EBITDA."

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