Central Garden & Pet (CENT): Exploring the value potential after recent moderate share price movement

Central Garden & Pet's (CENT) stock price has been moving lately, causing investors to re-evaluate the performance of the company's pet and garden brands this year. Stocks have moved slightly over the last week and month.

Check out our latest analysis for Central Garden & Pet.

While Central Garden & Pet's recent share price return of 9.5% over the last month suggests some return of optimism, the longer-term story is more nuanced, with a one-year total shareholder return of -14.1%. Momentum has increased in the short term; However, longer-term returns have lagged, suggesting investors remain cautious as they weigh the growth potential against recent headwinds.

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With the stock still trading at a significant discount to analyst targets and recent earnings momentum, investors are wondering whether Central Garden & Pet is poised for a rise in value or whether future growth is already reflected in its price.

Most popular narrative: 19.3% underrated

Central Garden & Pet's fair value, according to the most popular narrative, is well above its previous closing price of $34.16. The current market is still underperforming consensus fair value, suggesting significant valuation room if growth assumptions hold.

Continued operational rationalization through the Cost and Simplicity program, footprint rationalization, SKU rationalization and consolidation of distribution centers into DTC-ready hubs continues to unlock operational leverage. This approach supports consistent margin expansion and improves the bottom line despite temporary headwinds.

Read the full story.

Are you curious how margin gains and operational efficiencies lead to this high fair value? The most closely watched growth predictions in this narrative might surprise you. The numbers that determine this price target depend on bold assumptions for profits and market share. Want to find out the details that make this review stand out?

Result: Fair Value of $42.33 (UNDERVALUED)

Read the entire narrative and understand what lies behind the predictions.

However, continued supply chain disruptions and weather fluctuations in the gardening segment could pose significant short-term drag on growth.

Find out about the main risks of this Central Garden & Pet narrative.

Build your own central garden and pet narrative

If you want to dive deeper into the numbers or add your own perspective, you can quickly craft your own narrative in just a few minutes, do it your way

A good place to start is with our analysis, which highlights the top five benefits that investors are bullish on Central Garden & Pet.

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

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