Citi downgraded Valvoline to Neutral from Buy with a $37 price target after assuming coverage of the name. The pending sale of Global Products positions Valvoline as a retailer more akin to Citi’s hardlines coverage, the analyst tells investors in a research note. The firm believes Valvoline is poised to execute on its "fast-paced" unit growth targets but views its 2023 guidance as much more achievable than beatable given the Q1 EBITDA miss and significant acceleration in margin expansion embedded through the year. Citi is concerned the company could be susceptible to price competition, putting further risk to near-term same-store-sales growth and margin expansion.
Published first on TheFly
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