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Stockchase Opinions

Chris HensenEmpire Company (A)EMP.A.TOPAST TOP PICKFeb 06, 2015

(A Top Pick Oct 20/14. Up 20.87%.) Have done a great job of leveraging the balance sheet, making strategic acquisitions, doing strategic spinouts, buying back stock and increasing the dividend. Since he picked this, same store sales are accelerating. They have a full integration of Safeway, so there are a lot of cost synergies. At these levels, he doesn’t see as much upside as before, but wait for the right entry point.

$90.42

Stock price when the opinion was issued

$49.33

As of Jun 12, 2026. Market Open.

food stores
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BUY

Turned around Safeway acquisition. Inflation has helped food pricing. Canadian population growth. All the grocery chains own the best locations. Underperformed this year. Valuation much more attractive. Has always logged Loblaw, perhaps because EMP.A has a more confusing structure.

WEAK BUY

Defensive. Owned it a while ago, but Loblaw offers better value, the Shoppers chain, exposure to cities, and better efficiencies. Neither pays a good dividend, but Empire's chart looks attractive now for the short term. 

WAIT

Very expensive, trading up near maximums. Be patient, let things fall to something that will give you a better rate of return.

HOLD
Doing very well, based on food inflation. People have been shopping more downscale, and Loblaw has more exposure to discount chains than competitors. Inflationary pressures. A good, defensive place to be, though his preference is Loblaw.
HOLD
Very solid. Decent hold here. Low growth sector, about 5%. Good franchise. On weakness below $37, look at buying. If you're negative on the market, safe place to be. If you're positive on the market, there are better places for your money. Yield of 1.5% that will slowly increase over time.
WAIT
Well run. Benefited during the pandemic. Stepped up their online game. Online demand will continue. Tough comparisons to last year. May be better to wait and see how investors react over the next few quarters. Not huge downside, but more of a wait and see.
BUY ON WEAKNESS

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. Has seen some target downgrades, although relatively small. The weakness comes after the company stated it expects sales growth to slow. The decline is an interesting buy opportunity as it remains cheap and safe in these market conditions. Unlock Premium - Try 5i Free

WAIT

MRU-T vs. EMP.A-T. Metro has been his favourite grocery stock for 15 years. Grocery are the stay-at-home stocks but as we exit the pandemic this is not where you want to be. Don’t buy until the rotation is completed.

DON'T BUY
She owns another name in food retailing/grocers, who have benefitted from strong same-store sales growth, though this growth will moderate as economies open up more and eat out more. All retailers are increasing digital shopping and home delivery, though. It's a competitive space. All names have benefitted from the pandemic, but Empire doesn't offer much growth or pay a large dividend.
BUY

Billy Kawasaki’s Insights - Picks from 5i Research. The recent results were overall very solid. Revenue, as well as Earnings per Share both beat expectations. Same store sales were up 11% and continues to have good momentum. They are transitioning their brand right now and it is going as expected. Unlock Premium - Try 5i Free

TOP PICK
Pays a 1.5% yield. 13% YOY sales growth and a large 12.8% free cash flow yield. Cash flow grew YOY 236%. Earnings to grow 7% this year and 5% in 2021 with a PE of 14.3x. (Analysts’ price target is $37.67)
COMMENT

Earnings miss? She owns Loblaws instead of Empire, who just commented how competition is increasing. The recent stock pullback might just be a re-calibration of earnings metrics following the release of an earnings miss.

COMMENT
Loblaw vs. Empire vs. Metro Owns none. It's a toss-up. Metro is the best. Loblaw has had fits and starts. Empire is the dark horse, bouncing back from operational problems. One is as good as the others. Metro is good for the very long-term. But Empire for the shorter-term.
TOP PICK
Sobeys is their largest brand. They have 350 retail gas stations as well as grocery stores. Earnings are expected to grow 43% next year. (Analysts’ price target is $39.33)
COMMENT
Metro vs. Empire She owns Loblaw instead. The sector is defensive, so it's done well this year. She likes Shoppers Drug Mart, hence Loblaw, for its cross-selling via their Optimum rewards card. She prefers Metro of the two here, but thinks Loblaw is better.