David Bellinger, an analyst from Mizuho Securities, maintained the Buy rating on Valvoline (VVV – Research Report). The associated price target remains the same with $50.00.
David Bellinger’s rating is based on a comprehensive analysis of Valvoline’s recent financial performance and management’s strategic outlook. Bellinger acknowledges that while shares are trading lower following the second quarter results, this is juxtaposed against solid quarterly performance and an increase in mid-point guidance for adjusted EBITDA and EPS. He cites a more conservative and realistic approach to comparable store sales guidance, with a reduced upper range, but emphasizes that this does not signal a deceleration in current or future quarters. Key to his positive outlook is the company’s demonstrated ability to expand margins and maintain steady growth in system-wide revenues, which exceeded expectations.
Further reinforcing the Buy rating, Bellinger points to the consistent strength in comparable sales, with a notable increase from the previous quarter, and an improvement in two-year stacked trends. He highlights that non-oil change services have performed exceptionally well, exceeding internal forecasts and indicating a successful strategy in service diversification and premiumization. Despite the revision of the second half comparable sales outlook, Bellinger agrees with management’s assessment that full-year expectations are more attainable, and he remains optimistic about the company’s potential for growth, particularly as it continues to expand its service network and capitalize on newer units.
Bellinger covers the Consumer Cyclical sector, focusing on stocks such as Five Below, Wayfair, and Floor & Decor Holdings. According to TipRanks, Bellinger has an average return of 9.6% and a 63.16% success rate on recommended stocks.
In another report released on May 8, RBC Capital also maintained a Buy rating on the stock with a $48.00 price target.
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Valvoline (VVV) Company Description:
Valvoline, Inc. is engaged in producing, marketing and supplying of engine & automotive maintenance products and services. The company operates through three segments: Engine and Automotive Maintenance Products, Company-Owned Quick-lube Operations, and Franchised Quick-Lube Operations. The Engine and Automotive Maintenance Products segment include lubricants, antifreeze, chemicals, filters, and other complementary products for use across a wide array of vehicles and engines. The Company-Owned Quick-lube Operations segment includes the sale of engine and automotive maintenance products and related services. The Franchised Quick-Lube Operations segment include product sales and the license of intellectual property, which provides access to the Valvoline brand and proprietary information to operate service center stores over the term of a franchise agreement. Its products include motor oil, gear oil, pro-v racing and antifreeze and radiator. Valvoline was founded in 1866 and is headquartered in Lexington, KY.
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