Loblaw adapts to shifting market

Article Excerpt

Loblaw’s shares have jumped 40% in the past year; they, in fact, hit a new all-time high of $171.99 on July 24, 2024. The big gain is partly due to the 2018 transfer of the company’s real estate business to its parent company. That left it to focus on its main food and drugstore chains. Loblaw is also offering more medical services through its drugstores and in-store clinics. The company is now building more discount-price stores, particularly in urban areas. That should help it attract more cost-conscious shoppers as Canadians continue to cope with still-elevated interest rates and food inflation. LOBLAW COMPANIES LTD. $171 is a buy. Canada’s largest food retailer (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 306.0 million; Market cap: $52.3 billion; Price-to-sales ratio: 0.9; Dividend yield: 1.2%; TSINetwork Rating: Above Average; www.loblaw.ca) controls a network of 1,106 supermarkets. Those stores operate under a variety of banners including Loblaws, Zehrs, Provigo, Real Canadian Superstore, Valu-Mart and No Frills. Franchisees own…