Deutsche Bank Resumes Albertsons (ACI) Coverage with Hold Rating and $18 Target

Albertsons Companies, Inc. (NYSE:ACI) is included among the 15 Dividend Growth Stocks with the Highest Growth Rates.

On January 8, Deutsche Bank analyst Krisztina Katai resumed coverage of Albertsons Companies, Inc. (NYSE:ACI) with a Hold rating and an $18 price target. Deutsche said it is restarting coverage across broadline and food retailers, and expects 2026 to be another “mixed year.” In the firm’s view, the setup will likely be shaped by food disinflation, reduced government benefits, and consumers continuing to focus heavily on value. While that backdrop could make things tougher even for defensive names like food retail, the analyst added that “there are tailwinds on the horizon,” including a meaningful stimulus expected in the first half of 2026.

A day earlier, on January 7, Albertsons issued its outlook and struck a cautious tone. The company forecast softer annual identical sales growth and adjusted earnings, pointing to disruptions in SNAP benefits during the third quarter and pressure building in its pharmacy business due to Medicare drug price renegotiations.

Albertsons said a short lapse in food stamp benefits in November, caused by the US government shutdown, reduced identical sales by roughly 10 to 20 basis points in Q3. The company also noted that lower Medicare drug prices, which went into effect in January, are expected to weigh on fiscal 2025 identical sales by another 16 to 18 basis points.

That said, pharmacy was not all negative. Albertsons said its pharmacy business saw strength during the quarter from demand tied to immunizations, GLP-1 therapies, and core prescriptions. That helped offset some of the weakness linked to the SNAP disruption. The company also acknowledged that consumer behavior remains strained. Albertsons said many US shoppers, especially in low- and middle-income groups, have shifted toward cheaper products and are being more selective with spending as inflation stays elevated and uncertainty lingers.

For the full year, Albertsons expects identical sales growth of 2.2% to 2.5%, which is slightly lower at the midpoint than its prior outlook of 2.2% to 2.75%. The company also guided to adjusted net income of $2.08 to $2.16 per Class A share, compared with its earlier range of $2.06 to $2.19.

Albertsons Companies, Inc. (NYSE:ACI) is a major US food and drug retailer, operating stores that sell groceries, general merchandise, health and beauty products, pharmacy services, fuel, and other essentials both in-store and through digital channels.

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