Ingles Markets (IMKT.A) has opened Q1 2026 with total revenue of US$1.4 billion and basic EPS of US$1.48, with trailing twelve month EPS at US$5.01 on revenue of US$5.4 billion, setting a clear earnings benchmark for investors watching its recent rebound in profitability. The company has seen quarterly revenue move from US$1.29 billion and EPS of US$0.87 in Q1 2025 to US$1.37 billion and EPS of US$1.48 in Q1 2026, while trailing margins have edged higher, giving this update a more constructive tone for those focused on earnings quality.

With the latest numbers on the table, the next step is to see how this earnings reset lines up with the key narratives around Ingles Markets, and where the data starts to question some of those stories.

20.4% EPS growth against a 22.4% five year decline

• Over the last 12 months, earnings per share grew 20.4% year over year, yet over the past five years reported earnings declined by an average 22.4% each year, so the recent rebound sits on top of a weaker longer record.
• Bulls often argue that a rebound like this marks a lasting turn, but the numbers keep that claim in check:
  • The latest trailing EPS is US$5.01, compared with much lower quarterly figures like US$0.80 in Q2 2025. This shows the business can produce higher earnings, but also that results have been uneven.
  • The five year annual earnings decline of 22.4% directly contrasts with the recent 20.4% rise, so any bullish view built only on the latest year is leaning on a relatively short slice of the record.

Investors who see Q1 as the start of a clean turnaround might want to test that idea against the full five year earnings slide highlighted here, because the tension between those two figures is central to the story.

Margins inch up to 1.8% on US$5.4b sales

• Trailing net profit margin sits at 1.8% on US$5.4b of revenue, compared with 1.5% a year earlier, and Q1 2026 net income of US$28.1 million on US$1.37b of revenue fits inside that fairly slim but slightly higher margin range.
• What stands out for a bullish take is how these thin margins interact with the product mix:
  • With trailing net income of US$95.1 million on US$5.4b of revenue, even a small margin move matters. This lines up with the idea that operational tweaks across groceries, fuel, and pharmacy can show up quickly in EPS.
  • At the same time, the earlier Q1 2025 same store sales decline of 9.4% and later low single digit growth figures in 2025 underline that sales trends have not been consistently strong, so a bullish view that rests only on margin improvement needs to keep that patchy sales record in mind.

P/E of 17x versus US$84.90 price and DCF fair value

• The shares trade at US$84.90 with a trailing P/E of 17x, which sits below the US market average of 19.3x and below the US Consumer Retailing industry average of 22.5x, but above the peer average of 14x, while the provided DCF fair value is US$18.50, well below the current share price.
• Critics highlight this mix of ratios and fair value as a challenge for a bullish case built on value:
  • Against peers on 14x, a 17x P/E means investors are paying a higher multiple than that group, even though earnings have fallen 22.4% per year over five years.
  • The DCF fair value of US$18.50 in the data is far below the US$84.90 price, so anyone leaning on cash flow based valuation would see a wide gap to the current market level.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on Ingles Markets's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

See What Else Is Out There

Ingles Markets pairs a five year 22.4% annual earnings decline with a 17x P/E and DCF fair value of US$18.50 against a US$84.90 share price.

If that mix of long term earnings pressure and a rich current price makes you uneasy, check out our 53 high quality undervalued stocks and see if other ideas line up better with what you want to pay for earnings power.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.