Valvoline (VVV) "over-delivered" on fiscal Q4 same-store sales, assuaging concerns over structural deceleration, RBC Capital Markets said in a Wednesday note.
The company reported fiscal Q4 adjusted earnings of $0.45 per diluted share, down from $0.46 a year earlier, while net revenue increased to $453.8 million from $435.5 million.
Same-store sales grew 6% in the quarter and RBC said Valvoline guided for fiscal 2026 same-store sales growth of 4% to 6%, with management indicating a "strong start" to fiscal Q1. Earnings guidance for the year, however, was "lighter than anticipated," the investment firm noted.
RBC analysts said the earnings outlook could be just a conservative forecast or due to more drag from the Breeze Autocare acquisition. The investment firm estimated a potential gross margin headwind of about 45 basis points in fiscal 2026 from Breeze.
RBC cut its price target on Valvoline to $44 from $48, while maintaining its outperform rating.
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