Central Garden & Pet Company CENT, a market leader in the pet and garden industries, currently trades at a forward 12-month price-to-sales ratio of 0.73X. The figure is well below the industry and the S&P 500’s average of 3.06X and 4.67X, respectively, highlighting CENT as a potentially undervalued stock. For investors, this presents an attractive opportunity, which is further underscored by CENT’s current Value Score of A.

CENT Price-to-Sales Ratio (Forward 12 Months)

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CENT shares have gained 3.4% in the past six months against the industry and the S&P 500 index’s decline of 8.9% and 7%, respectively. Currently trading at $36.43, CENT is 23.3% below its 52-week high of $47.48, touched on May 15, 2024, presenting a compelling opportunity for value-focused investors, as the stock regains ground.

CENT Stock Past Six Months Performance

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Let us analyze the fundamentals of Central Garden & Pet to understand the key drivers behind its market position and financial resilience.

Decoding CENT’s Growth Strategy

Central Garden & Pet is reinforcing its leadership in the U.S. pet, and lawn and garden markets through a blend of innovation, operational efficiency and enhanced customer engagement. Its long-term growth strategy, Central-to-Home, continues to gain momentum, supported by digital transformation, supply-chain optimization and stronger marketing execution.

Innovation remains a core pillar, with a strong pipeline of new pet and garden products slated for fiscal 2025 and beyond. CENT is focused on delivering high-quality pet consumables and sustainable gardening solutions aligned with evolving consumer trends.

Operational efficiency is also improving under the company’s multi-year Cost and Simplicity program. From SKU rationalization to facility consolidations and deeper tech integration, these initiatives are streamlining operations. A key milestone was the launch of the Covington, GA, distribution center, which replaced seven older facilities. These moves helped expand adjusted gross margin by 160 basis points to 29.8% in the first quarter of fiscal 2025.

CENT's investments in digital infrastructure are paying off, particularly in the Pet segment, where in the first quarter of fiscal 2025 sales rose 4% to $427 million, buoyed by strong demand in dog and cat categories. E-commerce now represents 28% of pet segment revenues, growing at a healthy 6% year over year. Enhanced digital capabilities, retail media strategies and data analytics are reinforcing the company’s online presence.

The Garden segment also delivered double-digit e-commerce gains, supported by richer content and media campaigns. Revenues in this segment grew 2% year over year to $229 million in the fiscal first quarter, driven by strong bird feed and fertilizer sales. With seasonal demand expected to rise, the Garden segment is positioned for continued performance ahead.

Estimate Revisions Favoring CENT Stock

Reflecting positive sentiment around Central Garden & Pet, the Zacks Consensus Estimate for earnings per share has seen upward revisions. Over the past 60 days, the consensus estimate has risen 5 cents to $2.37 for the current fiscal and 3 cents to $2.46 per share for the next fiscal. These estimates indicate year-over-year growth rates of 10.8% and 3.8%, respectively. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

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Central Garden & Pet Stock Analysis

Central Garden & Pet’s strategic focus on innovation, cost optimization and digital expansion, supported by impactful initiatives, like the Cost and Simplicity program and Central-to-Home strategy, positions it for sustained long-term growth. For investors seeking growth-oriented opportunities, the company’s strong recovery and strategic focus make it a stock worth watching. At present, CENT carries a Zacks Rank #2 (Buy).

Other Stocks to Consider

United Natural Foods, Inc. UNFI distributes natural, organic, specialty, produce and conventional grocery and non-food products in the United States and Canada. At present, United Natural carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The consensus estimate for United Natural’s current fiscal-year sales and earnings implies growth of 1.9% and 485.7%, respectively, from the year-ago figures. UNFI delivered a trailing four-quarter earnings surprise of 408.7%, on average.

Utz Brands UTZ engages in the manufacture, marketing and distribution of snack foods in the United States and presently carries a Zacks Rank of 2. Utz Brands delivered a trailing four-quarter earnings surprise of 8.8%, on average.

The Zacks Consensus Estimate for Utz Brands’ current financial-year sales and earnings indicates growth of 1.2% and 10.4%, respectively, from the year-ago numbers.

Pilgrim's Pride Corporation PPC, which produces, processes, markets and distributes fresh, frozen and value-added chicken and pork products to retailers, distributors and foodservice operators in the United States, Europe and Mexico, currently holds a Zacks Rank #2. PPC delivered an earnings surprise of 25.7% in the trailing four quarters, on average.

The Zacks Consensus Estimate for Pilgrim’s Pride’s current-quarter earnings indicates growth of 64.9%, respectively, from the prior-year reported level.

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Central Garden & Pet Company (CENT) : Free Stock Analysis Report

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This article originally published on Zacks Investment Research (zacks.com).

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