As the largest retailer in Canada, Loblaw boasts well-recognized grocery and pharmacy banners and a sizable loyalty program that drives strong consumer engagement. However, we think the firm has failed to amass an economic moat based on either intangible assets or cost advantage, given its sales concentration in commoditized food retail, where low prices reign as the major point of differentiation.
As the largest retailer in Canada, Loblaw is in a strong position to meet shoppers’ needs by leveraging an extensive retail footprint and well-established grocery and pharmacy banners.
Given the bargaining clout of its unionized store and warehouse employees, Loblaw will likely continue to face persistent labor cost pressure in the coming years.
|
Metric
|
L
|
COST
|
WMT
|
|---|---|---|---|
Price/Earnings (Normalized) | 20.30 | 48.68 | 27.21 |
Price/Book Value | 4.19 | 15.58 | 5.78 |
Price/Sales | 0.82 | 1.30 | 0.75 |
Price/Cash Flow | 9.70 | 30.98 | 14.44 |
|
Metric
|
L
|
COST
|
WMT
|
|---|---|---|---|
Quick Ratio | 0.68 | 0.38 | 0.20 |
Current Ratio | 1.25 | 0.93 | 0.83 |
Interest Coverage | 4.48 | 50.15 | 8.94 |
|
Metric
|
L
|
COST
|
WMT
|
|---|---|---|---|
Return on Assets (Normalized) | 6.49% | 11.17% | 6.48% |
Return on Equity (Normalized) | 22.19% | 32.34% | 20.75% |
Return on Invested Capital (Normalized) | 10.48% | 22.17% | 12.00% |
|
Ticker
|
Name
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|
KR
| The Kroger Co | Bmhxtkqcf | Kknd | $40.0 Bil | |
SVNDY
| Seven & i Holdings Co Ltd ADR | — | Mrrlfh | $34.5 Bil | |
LBLCF
| Loblaw Companies Ltd | — | Hvph | $34.5 Bil | |
SVNDF
| Seven & i Holdings Co Ltd | — | Dyyxpt | $34.3 Bil | |
AHODF
| Koninklijke Ahold Delhaize NV | — | Sqgcv | $28.4 Bil | |
ADRNY
| Koninklijke Ahold Delhaize NV ADR | Jthdfgn | Bddn | $28.2 Bil | |
TSCDF
| Tesco PLC | — | Ccv | $25.2 Bil | |
TSCDY
| Tesco PLC ADR | Zlrhbtjk | Ppxjj | $25.2 Bil | |
WOLWF
| Woolworths Group Ltd | — | Hqlyrtf | $25.2 Bil | |
ACI
| Albertsons Companies Inc Class A | Bzhrflc | Mnq | $11.5 Bil |
