Petco Health and Wellness Company Inc. Class A Common Stock (WOOF)

FairStock Score: 32/100 — RISKY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I approach Petco as a retailer first and a turnaround second. It sells pet food, supplies, grooming, training and veterinary care through stores and online, so there is a recurring-need element. But the reported record is uneven: in fiscal Q2 2026, the quarter ended 2026-08-01, revenue was $1.5 billion and net income was $38.7 million, or diluted EPS $0.13; a year earlier, fiscal Q2 2025, the quarter ended 2025-08-02, net income was $14.0 million. That is real improvement, yet full-year fiscal 2025 net income was only $9.1 million on $6.0 billion of revenue, after a fiscal 2024 net loss of $101.8 million and a fiscal 2023 net loss of $1.3 billion. The FairStock calculations at the 2026-10-13 close show a P/B of 0.57, Graham Number of $3.08, and 21.75% margin of safety. FCF is strong: trailing twelve-month free cash flow was $237.8 million, a 34.0% FCF yield, and Piotroski F-Score is 7/9. But the Altman Z-Score of 0.10 and D/E of 2.34 warn of financial fragility. ROE of 2.58% and ROCE of 1.64% are very low, so the business has not yet earned economic returns above its cost of capital. Revenue has been roughly flat at $1.5 billion per quarter, and the FairStock P/E of 24.10 prices in recovery. I see a possible Lynch turnaround, not a classic moat. The asset value and cash generation are enticing; the debt and thin margins keep me cautious.

In plain English: Petco runs pet stores and services like grooming, training and veterinary care. The business has just returned to a small profit after large losses, but sales are roughly flat and it carries a lot of debt, so it looks weak-to-fragile rather than strong. At $2.41, the stock looks cheap compared with its asset value, but the low profit and high debt make that cheapness uncertain.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-08-01) · fiscal Q1 2026 10-Q (period ended 2026-05-02) · fiscal Q3 2025 10-Q (period ended 2025-11-01) · fiscal Q2 2025 10-Q (period ended 2025-08-02) · FY2025 10-K (period ended 2026-01-31) · FY2024 10-K (period ended 2025-02-01) · FY2023 10-K (period ended 2024-02-03)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer