How the Federated Co-operatives Deal Shapes Parkland’s Value in 2025

If you are staring at Parkland’s ticker, wondering if this is the right moment to buy, hold, or cash out, you are definitely not alone. The company’s shares have been treading water lately, up just 0.2% for the week and 0.3% over the last month. On the surface, that might suggest a lack of momentum. However, taking a broader view reveals a more interesting story. Year to date, Parkland’s stock is up a sturdy 18.7%, adding to a three-year gain of 39.4% and a five-year rise of 27.0%. Investors who stuck with Parkland over the long run have seen positive results.

So, what is driving this steady climb? Market watchers have pointed to strong demand across the sectors Parkland operates in, as well as broader market optimism for companies positioned to benefit from shifts in energy and retail fuel dynamics. There has also been ongoing discussion about consolidation in the industry, which can boost confidence among shareholders.

All of this brings us to the key question: is Parkland undervalued, overpriced, or sitting close to fair value? Parkland scores a modest 2 out of 6 on our valuation checklist, indicating there are some pockets of undervaluation but also areas where the market appears to have priced in much of the company’s positives already.

Next, we will break down the most common valuation approaches, examine exactly how Parkland measures up by each, and, for those interested in a deeper analysis, a more insightful perspective is available at the end.

Parkland scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Parkland Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model is a widely used approach that estimates a company’s intrinsic value by projecting its future cash flows and discounting them back to today’s value. This process gives investors a sense of what the business is worth, independent of short-term market sentiment.

For Parkland, the DCF model starts with its current Free Cash Flow of CA$1.17 billion. Analysts provide data for the next five years. After this period, Simply Wall St extrapolates further cash flow growth to 2035. The cash flow projections show modest growth, with expected Free Cash Flow of CA$1.06 billion in 2028 and reaching approximately CA$1.35 billion by 2035. All cash flow figures are based on Parkland’s reporting currency, CA$.

Based on these projections and discounting them to present value, the model calculates Parkland’s intrinsic share value at CA$126.63. This implies the stock is currently trading at a 69.3% discount to its estimated fair value, suggesting significant undervaluation.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Parkland.

Our Discounted Cash Flow (DCF) analysis suggests Parkland is undervalued by 69.3%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: Parkland Price vs Earnings

The Price-to-Earnings (PE) ratio is the preferred multiple for valuing profitable companies like Parkland because it directly relates the price of a share to the company’s current earnings. This makes it a straightforward and widely recognized measure to gauge if a stock is valued sensibly in relation to what it is actually generating for shareholders.

The benchmark for what counts as a “fair” PE ratio depends on the company’s growth prospects, risk profile, and how investors feel about the future. Rapidly growing or lower-risk companies tend to command higher PE ratios, while riskier or slower-growing firms trade at lower multiples.

Parkland’s current PE ratio stands at 22.7x, which is noticeably above both the Oil and Gas industry average of 12.4x and the peer group average of 19.2x. Simply Wall St’s Fair Ratio for Parkland is an internally calculated benchmark that weighs earnings growth outlook, industry, profit margins, and company-specific risks, and sits at 18.7x. This proprietary Fair Ratio offers a more precise gauge than a simple peer or industry comparison, as it reflects Parkland’s unique growth profile, market environment, and risk factors rather than just relying on broad averages.

Because Parkland’s current PE ratio is moderately higher than the Fair Ratio, the stock appears somewhat overvalued using this approach.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Parkland Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let's introduce you to Narratives. A Narrative is a simple, user-friendly way to bring your perspective on a company to life, by connecting the story you see unfolding for Parkland, its opportunities, risks, and business drivers, to your own financial estimates and assumptions for future revenue, margins, and fair value.

Unlike rigid valuation models, Narratives link the story behind the numbers to a clear financial forecast and a fair value, making it much easier to see how your expectations stack up against the share price. Narratives are available on Simply Wall St's Community page, where millions of other investors share and discuss their views.

This tool lets you quickly compare Fair Value to the current market Price, helping you know when to buy or sell, and it updates dynamically as new information becomes available. Your view stays relevant as the market moves. For example, for Parkland, one investor currently sees opportunity and values it at CA$43.06 per share, while another, more cautious on future growth and risks, values it at CA$34.50.

Do you think there's more to the story for Parkland? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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