Petco added to Best Ideas List at Wedbush

Wedbush added Outperform-rated Petco (WOOF) to the firm’s Best Ideas List and raised the price target on the shares to $4 from $3 following better-than-expected Q1 results that beat consensus expectations on the top- and bottom-lines and Q2 sales and EBITDA guidance above consensus expectations. Investors looked positively on the improving sales trend and the strong Q1 gross margin performance, with Petco’s shares outperforming the market. Even after Wednesday’s run, Wedbush still sees plenty of upside to shares as current price levels value Petco at just 6.1-times 2024 EV/EBITDA, in line with secularly challenged Best Buy (BBY), creating an attractive entry point.