Loblaw Stock (L:TSX) Rises on Positive Earnings Forecast

The fundamental analysis for Loblaw stock got graded at a score of 4.3 out of 10.

Loblaw Stock Analysis:

Analysts rate Loblaw stock with a consensus Buy rating. With a 12-month average target price of $122.24 per share.
The average analyst target price for Loblaw stock over the next 12 months is CAD 122.24. Based on 10 analysts’ forecasts. The typical analyst recommendation for Loblaw stock is to Buy. Based on 6 positive signs and 8 negative indications. Stock Target Advisor’s personal stock analysis of Loblaw stock is a little Bearish. The stock price of Loblaw stock was CAD 107.25 at the most recent close. The stock price of Loblaw Companies Limited moved by:
-5.71% over the previous week
-1.85% over the previous month
+9.04% over the previous year

Loblaw Stock News:

The Canadian retailer increased its yearly profitability prediction. Due to the continued strong demand for food and medicines despite rising costs. In contrast to its previous projection of mid-to-high teens. Loblaw anticipates adjusted earnings per share growth. in the high teens for the fiscal year 2022. In the three months, that ended on October 8, total revenue increased to C$17.39 billion. This increased from C$16.05 billion in the prior year. That exceeded the C$16.85 billion forecast of analysts.

About Loblaw Companies Limited (L:TSX:CA)

The food and pharmacy company Loblaw Companies Limited operates in Canada. They cater to:
  • grocery
  • pharmacy
  • health and beauty
  • clothing
  • general retail
  • financial services
  • wireless mobile products and services industries

Retail and financial services are its two business segments. The Retail division runs:

  • associate-owned drug stores.
  • corporate- and franchise-owned retail food stores
  • In-store pharmacies,
  • other retailers of health and beauty products,
  • clothing retailers, and
  • other retailers of general commodities
The Financial Services section offers:
  • The PC Optimum program
  • banking and credit card services,
  • insurance brokerage services
  • communications services
Additionally, it offers the PC Health app, a health and wellness program. This gives Canadians access to help and services for their health. Under many brands, Loblaw Companies Limited offers its goods and services. The company’s headquarters are in Brampton, Canada. It got established in 1919. George Weston Limited’s subsidiary, Loblaw Companies Limited, carries on business.

Fundamental Loblaw Stock Analysis:


Positive Fundamentals:

High market capitalization.  This organization is among the top quartile and is one of the biggest in its industry. These businesses are more reliable.
Superior returns on risk.  In the top quartile, this stock has outperformed its sector rivals. Based on a risk-adjusted basis over the course of at least a 12-month holding period.
A high dividend yield.  The stock has outperformed its industry rivals over the past 5 years. (for a hold duration of at least 12 months) and is in the top percentile for average annual dividend returns. For investors seeking high-income yields, this could be an excellent buy. Especially if it is excelling on a total return basis.
A healthy cash flow.  The last four quarters saw positive total cash flow for the organization.
A favourable free cash flow.  The last four quarters saw the company generate positive total free cash flow.
Superior growth in earnings.  In the preceding five years, this stock’s profits growth was in the top quartile for its industry.

Negative Fundamentals:

Excessive volatility. This company’s total returns have been erratic and higher above the industry average. Based on the 5-year analysis. If you plan to invest in such a stock, be sure your risk tolerance is adequate.
Lower than average total returns. Annual average total returns during the previous five years. The company lagged behind its competitors.
Excessive in comparison to wages. The stock is trading above the sector median and at a premium to its peers’ price to earnings.
Compared to book value, it’s overpriced.  On a price-to-book value basis, the stock is selling at a premium to the median of its peer group.
Overpriced based on cash flow.  On a price-to-cash flow ratio, the stock is trading at a premium to that of its competitors. Its pricing is higher than the sector median.
Low equity returnThe management of the company has produced a lower-than-average return on equity. Based on the competitor analysis and the past four quarters’ analysis.
Inadequate capitalization. The company produced a lower median return on invested capital. During the past four quarters.
Priced based on free cash flow.  On a price-to-free cash flow basis, the stock is trading at a premium to that of its competitors. Its pricing is higher than the sector median.

Conclusion of Analysis

The fundamental analysis for Loblaw stock got graded at a  score of 4.3 out of 10.