Is Guru Organic Energy stock a buy?

Roth Capital Partners analyst Sean McGowan says GURU Organic Energy’s (GURU Organic Energy Stock Quote, Chart, News, Analysts, Financials TSX:GURU) second-quarter results again showed the benefits of its distribution model, with revenue and retail sales growth outpacing the broader energy drink category.

In a June 15 update, McGowan maintained his “Buy” rating and $8.00 target on GURU.

“GURU’s results again demonstrated significant benefits of its distribution model,” McGowan said. “Revenue growth as well as retail sales significantly outpaced overall category growth, and gross margins expanded nearly 400 bps. We expect the company to continue to post solid revenue growth and steadily expanding full-year EBITDA margins.”

GURU reported second-quarter fiscal 2026 revenue of $8.5-million, up 31.6% year-over-year but below McGowan’s $9.0-million estimate. Canadian revenue rose 47%, while U.S. revenue declined three%, or rose 0.6% on a constant-currency basis.

McGowan said U.S. revenue was affected by retailer inventory management, but noted that retail sales rose 15%, according to Circana, and shipments increased significantly after quarter-end.

The company also added Sprouts Farmers Market as a U.S. customer, with GURU products expected to be available across the chain later this month.

“We expect GURU’s U.S. revenue to grow by double digits in 3Q and beyond,” McGowan said.

Gross margin was 63.6%, ahead of McGowan’s 62.7% estimate, reflecting the company’s shift from Pepsi distribution to direct store delivery. He trimmed his full-year gross margin estimate to 63.0% from 63.3%, citing the addition of Sprouts, strength in warehouse clubs and potential input-cost pressure.

Adjusted EBITDA was a loss of $800,000, compared with McGowan’s forecast for a $400,000 loss and a loss of $1.2-million a year earlier. But trailing 12-month Adjusted EBITDA was positive for the second consecutive period, reaching $1.2-million.

McGowan said growth investments could leave some quarters unprofitable, but he still expects GURU to report positive net income and Adjusted EBITDA for fiscal 2026.

McGowan lowered his fiscal 2026 Adjusted EBITDA forecast to $900,000 from $2.0-million and his fiscal 2027 estimate to $2.6-million from $3.3-million, on revenue of $39.8-million and $46.2-million, respectively.

-30-