Primo Water’s Solid First Quarter Leaves It Poised to Meet Our Short- and Long-Term Outlooks

We do not plan to alter our $17 (CAD 21.50) per share valuation of no-moat Primo Water much after it posted first-quarter results consistent with our near- and long-term outlooks. With indications that pricing and staffing actions are proceeding well, the company should be able to weather the inflationary environment, although we continue to believe it has limited avenues to stem long-term competition considering the commodity nature of its core product. At current levels, the shares seem attractive.