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Loblaw Companies
(TSX:L)
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Rating:78Outperform
Price Target:
C$75.00
▲(24.13% Upside)
Action:Reiterated
Date:07/31/26
The score is driven primarily by strong financial performance (steady growth and solid free-cash-flow generation, despite leverage) and a positive earnings-call outlook with reiterated high-single-digit EPS growth guidance and increased buybacks. Technicals are supportive with the stock trading above key moving averages, while valuation is moderate and the dividend yield is relatively low.
Positive Factors
Steady growth and resilient profitability
Consistent revenue growth and gradually improving profitability indicate that Loblaw is expanding while preserving operating discipline. Although grocery margins are structurally modest, the stable gross margin and upward trend in operating and net margins support durable earnings power over the next several quarters.
Negative Factors
Meaningful leverage
Despite recent debt reduction, leverage remains elevated for a defensive retailer and can constrain financial flexibility. A meaningful debt burden leaves less room to absorb weaker consumer conditions, fund expansion internally, or protect shareholder returns if financing costs remain high.
Read all positive and negative factors
Positive Factors
Negative Factors
Steady growth and resilient profitability
Consistent revenue growth and gradually improving profitability indicate that Loblaw is expanding while preserving operating discipline. Although grocery margins are structurally modest, the stable gross margin and upward trend in operating and net margins support durable earnings power over the next several quarters.
Read all positive factors
Loblaw Companies (L) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$78.82B
Dividend Yield0.86%
Average Volume (3M)1.22M
Price to Earnings (P/E)28.7
Beta (1Y)0.13
Revenue Growth3.75%
EPS Growth16.92%
CountryCA
Employees220,000
SectorConsumer Defensive
Sector Strength42
IndustryGrocery Stores
Share Statistics
EPS (TTM)2.39
Shares Outstanding1,150,594,800
10 Day Avg. Volume1,477,469
30 Day Avg. Volume1,223,563
Financial Highlights & Ratios
PEG Ratio-0.41
Price to Book (P/B)6.68
Price to Sales (P/S)1.15
P/FCF Ratio17.99
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$73.71Price Target Upside22.00% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering7
EPS Forecast (FY)2.55
Revenue Forecast (FY)C$65.43B
Loblaw Companies Business Overview & Revenue Model
Company Description
Loblaw Companies Limited is a prominent Canadian enterprise primarily focused on food and pharmacy, delivering a wide array of products and services across the nation. Its diverse business interests encompass grocery, pharmacy, health and beauty, ...
How the Company Makes Money
Loblaw makes money primarily by selling products and services through its retail network and related platforms. (1) Food and everyday merchandise retail: The largest revenue stream comes from selling groceries and consumables (fresh foods, package...
Loblaw Companies Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 19, 2026
Earnings Call Sentiment Positive
The call emphasized broad operational strength: solid revenue and adjusted EPS growth, improving adjusted EBITDA, robust pharmacy momentum, strong e-commerce expansion, successful store openings (including an exceptionally strong T&T California debut), and a strengthened capital-return program. Management also highlighted positive early signs from GLP-1 generics as a potential gross margin tailwind. Near-term negatives were acknowledged but appear manageable: ramp costs for new distribution capacity and stores, some category/timing headwinds (Easter shift, tobacco/liquor, tariff timing), a one-month reporting timing impact from the PC Financial sale, and external risks like fuel-price volatility. Overall, the positives and strategic tailwinds substantially outweigh the manageable short-term headwinds.Positive Updates
Top-line growth and strong profitability
Total revenue (including PC Financial) of $15.0B, up 4.1% year-over-year. Total company adjusted EBITDA increased 5.1% to $1.9B with adjusted EBITDA margin improving ~10 basis points. Adjusted diluted net earnings per common share rose 11.9% to $0.66 (GAAP diluted EPS $0.64, up 8.5%).
Negative Updates
Consumer remains value-focused, trade-down pressure
Customers continue to seek value, promotions and trade down to discount banners; management notes increased private label uptake and changes in shopping patterns, which underline ongoing pricing pressure and the need for promotional investment.
Read all updates
Q2-2026 Updates
Positive
Negative
Top-line growth and strong profitability
Total revenue (including PC Financial) of $15.0B, up 4.1% year-over-year. Total company adjusted EBITDA increased 5.1% to $1.9B with adjusted EBITDA margin improving ~10 basis points. Adjusted diluted net earnings per common share rose 11.9% to $0.66 (GAAP diluted EPS $0.64, up 8.5%).
Read all positive updates
Company Guidance
Loblaw reiterated that it expects Retail earnings to grow faster than sales and guided to adjusted net earnings per common share growth in the high single digits for the year despite a Q3 timing headwind (only one month of EQB earnings will be recognized in Q3); management expects continued consistent top‑line sales growth in Q3, ~75 store openings this year, ongoing consistent free cash‑flow growth and a larger NCIB (now targeting $2.1 billion of share repurchases for the year, up $200 million; $552 million repurchased in Q2 and $1.2 billion year‑to‑date), and plans to increase its EQB stake from ~19.9% toward ~25%; they also expect GLP‑1s going generic to drive double‑digit revenue growth in 2027 with gross profit dollars and margin rising by more than top‑line growth, and noted strong returns (ROE 27.2%, ROC 12.5%) alongside confidence in gross margin outlook.Loblaw Companies Financial Statement Overview
Summary
Income Statement
84
Very Positive
Balance Sheet
71
Positive
Cash Flow
82
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 64.63B | 63.90B | 61.01B | 59.53B | 56.50B | 53.17B |
| Gross Profit | 19.90B | 19.88B | 19.73B | 19.04B | 17.98B | 16.73B |
| EBITDA | 7.20B | 7.18B | 6.90B | 6.64B | 6.16B | 5.61B |
| Net Income | 2.79B | 2.67B | 2.17B | 2.10B | 1.92B | 1.88B |
Balance Sheet | ||||||
| Total Assets | 41.71B | 41.58B | 40.88B | 38.98B | 38.15B | 36.61B |
| Cash, Cash Equivalents and Short-Term Investments | 1.01B | 1.04B | 2.11B | 1.95B | 1.93B | 2.44B |
| Total Debt | 16.58B | 25.14B | 19.18B | 18.17B | 17.61B | 16.55B |
| Total Liabilities | 30.58B | 30.39B | 29.61B | 27.36B | 26.69B | 24.88B |
| Stockholders Equity | 10.97B | 11.03B | 11.09B | 11.46B | 11.30B | 11.57B |
Cash Flow | ||||||
| Free Cash Flow | 4.78B | 4.10B | 3.60B | 3.58B | 3.18B | 3.65B |
| Operating Cash Flow | 6.53B | 5.81B | 5.80B | 5.65B | 4.75B | 4.83B |
| Investing Cash Flow | -1.61B | -1.89B | -2.02B | -1.84B | -2.37B | -1.27B |
| Financing Cash Flow | -4.72B | -3.99B | -3.82B | -3.93B | -2.75B | -3.25B |
Loblaw Companies Technical Analysis
Positive
60.42
Price Trends
63.42
Positive
63.79
Positive
63.25
Positive
Market Momentum
1.72
Negative
59.17
Neutral
42.52
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:L, the sentiment is Positive. The current price of 60.42 is below the 20-day moving average (MA) of 65.83, below the 50-day MA of 63.42, and below the 200-day MA of 63.25, indicating a bullish trend. The MACD of 1.72 indicates Negative momentum. The RSI at 59.17 is Neutral, neither overbought nor oversold. The STOCH value of 42.52 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:L.
Loblaw Companies Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | C$78.82B | 28.66 | 25.25% | 0.86% | 3.75% | 16.92% | |
72 Outperform | C$55.30B | 41.10 | 97.52% | 0.23% | 17.86% | 10.53% | |
67 Neutral | C$15.80B | 32.13 | 7.45% | 2.02% | -4.63% | ― | |
65 Neutral | C$11.11B | 50.90 | 4.27% | 1.85% | 2.45% | -67.24% | |
63 Neutral | C$39.65B | 40.75 | 20.42% | 1.17% | 3.74% | -0.07% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
52 Neutral | C$19.80B | 22.65 | 12.87% | 1.71% | 2.94% | -8.82% |
* Consumer Defensive Sector Average
TSE:L
Loblaw Companies
68.50
13.83
25.29%
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Loblaw Companies Corporate Events
Business Operations and StrategyFinancial Disclosures
Loblaw Investor Day to Highlight Core Retail Strategy and Expansion into High-Growth Platforms
Positive
Sep 8, 2026
Loblaw Companies will host its “Retail and Beyond” Investor Day on September 9, 2026, to outline strategy, operating priorities and profitable growth opportunities across its core supermarket, discount and pharmacy businesses and newer...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.