Petco price target lowered to $10 from $14 at RBC Capital

RBC Capital lowered the firm’s price target on Petco to $10 from $14 but keeps an Outperform rating on the shares. The company’s Q4 results saw solid comp growth while its in-line margins speak to the solid execution by Petco’s management team, the analyst tells investors in a research note. RBC adds however that the sales mix shift to consumables, exposure to variable rate debt, and uncertainty around sponsor ownership remain for the stock overhangs.