Update shared on 20 Nov 2025
Narrative Update: Analyst Price Target for Pets at Home Group
Analysts have lowered the average price target for Pets at Home Group by a significant margin, dropping from approximately 275 GBp to a range of around 180 to 215 GBp, citing recent downward revisions in profit expectations and a more cautious growth outlook.
Analyst Commentary
Recent revisions by street research analysts reflect both optimism surrounding Pets at Home Group's fundamentals as well as a more measured view of future growth prospects. The following highlights summarize the key points from recent commentary.
Bullish Takeaways
- Bullish analysts continue to see upside in Pets at Home Group, maintaining Buy ratings even as price targets are reduced. This indicates the company remains fundamentally attractive at lower valuations.
- The core business is seen as resilient, with supportive long-term trends in pet ownership and recurring revenue streams from subscription and healthcare offerings.
- Recent operational execution, including cost control and customer engagement initiatives, is viewed as a positive factor that may underpin future earnings recovery.
Bearish Takeaways
- Bearish analysts cite a more cautious outlook on growth that has led to ratings downgrades and further reductions in price targets.
- Forecasts for profit have been lowered due to slower anticipated consumer demand, which could limit upside in the near term.
- There are concerns about Pets at Home Group’s ability to deliver consistent margin expansion given macroeconomic pressures and increased competition.
- Uncertainty around the pace of recovery in retail spending could weigh on valuation, making analysts hesitant to recommend aggressive positioning at current levels.
What's in the News
- Chief Executive Officer Lyssa McGowan has left Pets at Home Group effective September 18, 2025. A search is underway for a permanent replacement (Key Developments).
- Chief Financial Officer Mike Iddon will retire after nine years and will remain until Spring 2026 to ensure a smooth transition. Sarah Pollard, previously CFO at PZ Cussons, has been appointed as his successor (Key Developments).
Valuation Changes
- The Fair Value Estimate remains unchanged at £2.33 per share.
- The Discount Rate has risen slightly, increasing from 9.39% to 9.64%.
- The Revenue Growth Forecast is stable and holds steady at approximately 0.70%.
- The Net Profit Margin Outlook is unchanged, maintaining a level near 4.75%.
- The Future P/E Ratio has risen moderately from 16.9x to 19.3x, reflecting a higher valuation multiple expected by analysts.
Disclaimer
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