On December 31, Joe Feldman of Telsey Advisory reaffirmed his outperform rating for Albertsons Companies (NYSE:ACI), setting a target price of $24. Feldman estimated the stock offers an upside potential exceeding 44%.
The analyst forecasted adjusted EBITDA surpassing $1 billion, based on a 2.5% growth in identical store sales. He projected an adjusted EPS of $0.68, citing easing inflation and increased demand for private brands and digital offerings. Feldman noted that financial impacts from these factors would be partially offset by cash expenditures on pricing, workforce, and technology. He expressed continued optimism regarding the pharmacy business.
Feldman also pointed to industry-wide growth figures, including low-single-digit growth in the broader grocery sector and 2%-3% growth in U.S. Food & Beverages retail sales.
On December 29, Steven Shemesh, an analyst at RBC Capital, also reaffirmed an Outperform rating for Albertsons Companies. Shemesh set a target price of $21, representing an upside of over 26% from current levels. He stated the stock trades at a significant discount, with a forward adjusted EBITDA multiple of 4.5x.
Albertsons Companies is a major operator in the U.S. food and drug retail sector. Its stores sell products including groceries, beauty care, pharmacy items, and general merchandise. The company also runs fuel stations, pharmacies, coffee shops, and distribution facilities under various banners.