Petco Health and Wellness Company (WOOF) AI Stock Analysis

• Market Cap: $891.22M
• Dividend Yield: N/A
• Average Volume (3M): 2.28M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.76
• Revenue Growth: -2.83%
• EPS Growth: 97.94%
• Country: US
• Employees: 29,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 0.09
• Shares Outstanding: 242,466,860
• 10 Day Avg. Volume: 2,216,504
• 30 Day Avg. Volume: 2,281,098
• PEG Ratio: 0.10
• Price to Book (P/B): 0.84
• Price to Sales (P/S): 0.15
• P/FCF Ratio: 18.82
• Enterprise Value/Market Cap: 4.02
• Enterprise Value/Revenue: 0.59
• Enterprise Value/Gross Profit: 1.55
• Enterprise Value/Ebitda: 12.27
• 1Y Price Target: $4.03
• Price Target Upside: 26.73% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 10

• Rating: 50 Neutral
• Price Target: $3.50 ▲(10.06% Upside)

Petco's overall stock score is driven by significant financial challenges, including declining revenue and negative profitability, which weigh heavily on the score. Technical analysis further indicates bearish trends. However, improvements in profitability and operational efficiency highlighted in the earnings call provide some optimism. The valuation remains unattractive due to a negative P/E ratio and lack of dividend yield.

Positive Factors

Profitability Improvement

The significant increase in operating income and EBITDA indicates successful cost management and operational efficiency, which can lead to sustained profitability improvements.

Gross Margin Expansion

The expansion in gross margin reflects effective pricing strategies and inventory management, which can enhance long-term profitability and competitive positioning.

Cash Flow Growth

The strong growth in free cash flow indicates improved cash generation, providing financial flexibility for strategic investments and debt reduction.

Negative Factors

Declining Revenue

The decline in net sales highlights challenges in maintaining revenue growth, which could impact long-term market share and financial performance.

High Leverage

The high leverage level can strain financial stability, limiting the company's ability to invest in growth opportunities and manage economic downturns.

Negative Profitability

The negative profitability reflects operational inefficiencies and revenue challenges, which need addressing to achieve sustainable financial health.

Petco Health and Wellness Company Business Overview & Revenue Model

Company Description

Petco Health and Wellness Company (WOOF) is a leading pet specialty retailer that focuses on delivering health and wellness solutions for pets. The company operates in various sectors including pet food, supplies, and services, offering a wide range of products such as premium pet food, grooming, training, and veterinary services. Petco's commitment to improving the health and well-being of pets is reflected in its comprehensive approach to pet care, making it a trusted resource for pet owners.

How the Company Makes Money

Petco generates revenue through multiple key streams, primarily from the sale of pet food and supplies, which includes both premium and everyday products. Additionally, the company offers services such as grooming, training, and veterinary care, which contribute significantly to its earnings. The growth of its e-commerce platform has also enhanced revenue, allowing Petco to reach a broader customer base. Strategic partnerships with brands and suppliers, along with loyalty programs for customers, further bolster its financial performance. The company's focus on health and wellness also positions it well within the growing market for pet care, supporting sustained revenue growth.

Petco Health and Wellness Company Financial Statement Overview

Summary

Petco Health and Wellness Company faces significant financial challenges, with declining revenue and persistent losses impacting profitability. The company’s high leverage and negative ROE are concerns for financial stability, while cash flow metrics indicate some ability to generate operational cash despite challenges. The financial outlook suggests a need for strategic adjustments to improve profitability and reduce leverage.

Income Statement

Petco Health and Wellness Company has shown inconsistent revenue and profitability trends. The TTM revenue of $6.08 billion is slightly down from the previous annual figure of $6.12 billion, indicating a revenue decline. The gross profit margin for TTM is approximately 38.08%, showing some efficiency in cost management. However, the net profit margin is negative at -1.10%, reflecting continued losses. EBIT and EBITDA margins are weak at 0.66% and 4.14%, respectively, highlighting operational challenges.

Balance Sheet

The company's balance sheet reveals a high debt-to-equity ratio of 2.64, indicating significant leverage. Return on Equity (ROE) is negative due to net losses, which is a concern for profitability. The equity ratio stands at 21.63%, suggesting a moderate level of equity financing relative to total assets. Overall, the balance sheet shows high leverage and limited equity, posing financial stability risks.

Cash Flow

Petco's cash flow position is somewhat stable with a positive operating cash flow to net income ratio of -2.55, despite net losses, showing some ability to generate cash from operations. Free cash flow to net income ratio is -0.70, indicating challenges in achieving positive free cash flow amidst losses. The free cash flow growth rate is negative, reflecting decreased efficiency in capital allocation.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.05B	6.12B	6.26B	6.04B	5.81B	4.92B
Gross Profit	2.32B	2.32B	2.35B	2.43B	2.43B	2.11B
EBITDA	292.29M	7.05M	-971.83M	407.75M	452.22M	352.36M
Net Income	-28.20M	-101.82M	-1.28B	90.80M	164.42M	-26.48M
Balance Sheet
Total Assets	5.15B	5.19B	5.36B	6.61B	6.50B	6.08B
Cash, Cash Equivalents and Short-Term Investments	188.75M	165.76M	125.43M	201.90M	211.60M	111.40M
Total Debt	2.94B	2.94B	3.04B	3.13B	3.05B	3.00B
Total Liabilities	4.01B	4.08B	4.18B	4.23B	4.24B	4.02B
Stockholders Equity	1.14B	1.11B	1.18B	2.38B	2.27B	2.07B
Cash Flow
Free Cash Flow	58.68M	49.68M	-9.88M	67.98M	119.11M	109.06M
Operating Cash Flow	187.16M	177.67M	215.72M	346.00M	358.21M	268.62M
Investing Cash Flow	-123.93M	-123.90M	-207.44M	-320.32M	-237.08M	-157.19M
Financing Cash Flow	-7.14M	-8.75M	-85.35M	-33.84M	-18.78M	-146.61M

Petco Health and Wellness Company Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.18
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WOOF, the sentiment is Negative. The current price of 3.18 is below the 20-day moving average (MA) of 3.61, below the 50-day MA of 3.57, and below the 200-day MA of 3.22, indicating a bearish trend. The MACD of -0.04 indicates Positive momentum. The RSI at 35.89 is Neutral, neither overbought nor oversold. The STOCH value of 8.72 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WOOF.

Petco Health and Wellness Company Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	―	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
CHWY	―	$13.99B	95.15	34.48%	―	9.04%	-56.79%
BARK	―	$154.22M	―	-26.91%	―	-3.08%	14.42%
TDUP	―	$1.08B	―	-58.93%	―	-10.39%	14.92%
WOOF	―	$891.22M	―	-2.48%	―	-2.83%	97.94%
NHTC	―	$50.20M	143.89	1.05%	18.35%	-2.07%	-61.05%
FLWS	―	$229.20M	-1.04	-67.22%	―	-8.07%	-2206.16%

Petco Health and Wellness Company Corporate Events

Petco Earnings Call: Profitability Up, Sales Challenges Loom

Petco Health and Wellness Company Inc. recently held its earnings call, revealing a balanced sentiment between internal improvements and external challenges. The company showcased significant strides in profitability and operational efficiency, yet faces hurdles in achieving top-line growth amid tough sales comparisons and tariff impacts in the latter half of the year.

Petco Reports Q2 2025 Financial Results and Raises Outlook

Petco Health and Wellness Company Inc., a leading retailer in the pet care industry, offers a wide range of products and services for pet owners across the U.S., Mexico, and Puerto Rico. The company is known for its extensive selection of pet supplies, expert support, and commitment to animal welfare.

Petco Reports Q2 2025 Financial Results

Petco announced its financial results for the second quarter of 2025, reporting net sales of $1.5 billion, a 2.3% decrease year over year, and a gross profit margin increase to 39.3%. Despite the decline in sales, the company improved its operating income and net income, leading to an increased earnings outlook for the fiscal year 2025. Petco plans to continue its strategic investments to drive sustainable growth and maintain its competitive position in the market.

The most recent analyst rating on (WOOF) stock is a Hold with a $3.00 price target. To see the full list of analyst forecasts on Petco Health and Wellness Company stock, see the WOOF Stock Forecast page.

Petco to Present at Goldman Sachs Retail Conference

On August 21, 2025, Petco Health and Wellness Company announced its participation in the 32nd Annual Goldman Sachs Global Retailing Conference scheduled for September 4, 2025. The company will present at the conference, with a live webcast available on its investor relations page. This participation highlights Petco’s active engagement in the retail industry and its commitment to maintaining visibility and communication with stakeholders.

The most recent analyst rating on (WOOF) stock is a Buy with a $4.00 price target. To see the full list of analyst forecasts on Petco Health and Wellness Company stock, see the WOOF Stock Forecast page.