PetMed Express (NASDAQ:PETS) Releases Earnings Results, Misses Estimates By $0.40 EPS

PetMed Express (NASDAQ:PETS) posted its quarterly earnings results on Thursday. The company reported ($0.28) earnings per share (EPS) for the quarter, missing the consensus estimate of $0.12 by ($0.40), FiscalAI reports. The business had revenue of $41.02 million during the quarter, compared to analyst estimates of $71.00 million. PetMed Express had a negative net margin of 32.00% and a negative return on equity of 76.86%.

Here are the key takeaways from PetMed Express’ conference call:

• Revenue remained weak: Q1 net sales fell 19.9% year over year to $41.0 million, primarily due to continued softness in prescription medication sales, while gross margin declined to 27.6% from 28.1%.
• The net loss narrowed substantially to $6.1 million from $34.2 million a year ago, largely because the prior-year period included a goodwill and trade-name impairment charge; however, adjusted EBITDA loss worsened to $3.4 million from $2.7 million.
• Customer acquisition efficiency improved, with approximately 70,000 new customers added and customer acquisition cost declining 15% year over year to $60. Recurring sales increased to 61.5% of gross sales from 57.6%, supporting the company’s subscription-driven base.
• PetMeds launched its first large-scale white-label pharmacy partnership with Rural King, giving customers across more than 150 stores access to pet medications and auto-ship services while creating a potential new customer acquisition and B2B revenue channel.
• The company agreed to sell and lease back its headquarters and distribution center for $37 million, which management expects will strengthen the balance sheet and provide financial flexibility; PetMeds had $13.1 million in cash and no debt at quarter-end.

PetMed Express Stock Up 1.0%

NASDAQ PETS traded up $0.02 during trading hours on Thursday, reaching $2.03. 208,038 shares of the company were exchanged, compared to its average volume of 345,318. The stock has a market capitalization of $43.39 million, a P/E ratio of -0.74 and a beta of 0.76. PetMed Express has a 1 year low of $1.57 and a 1 year high of $4.10. The business’s 50 day simple moving average is $1.90 and its 200-day simple moving average is $2.31.

Analyst Upgrades and Downgrades

A number of research analysts have weighed in on the stock. Weiss Ratings raised shares of PetMed Express from a “sell (e+)” rating to a “sell (d-)” rating in a research note on Wednesday, August 5th. Zacks Research raised shares of PetMed Express to a “hold” rating in a research report on Thursday, April 30th. Finally, Wall Street Zen upgraded shares of PetMed Express from a “strong sell” rating to a “hold” rating in a report on Saturday, June 6th. One analyst has rated the stock with a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat.com, the company presently has an average rating of “Reduce”.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently modified their holdings of the stock. Steel Partners Holdings L.P. bought a new stake in shares of PetMed Express in the fourth quarter valued at approximately $620,000. Federated Hermes Inc. boosted its holdings in PetMed Express by 30.1% in the 4th quarter. Federated Hermes Inc. now owns 627,743 shares of the company’s stock worth $2,009,000 after buying an additional 145,357 shares during the period. Bridgeway Capital Management LLC grew its stake in PetMed Express by 164.3% in the 3rd quarter. Bridgeway Capital Management LLC now owns 107,816 shares of the company’s stock valued at $271,000 after buying an additional 67,016 shares in the last quarter. CIBC Bancorp USA Inc. purchased a new position in PetMed Express in the 3rd quarter valued at approximately $153,000. Finally, UMB Bank n.a. purchased a new position in PetMed Express in the 4th quarter valued at approximately $192,000. 73.33% of the stock is owned by institutional investors.

About PetMed Express

PetMed Express, Inc operates as an online and catalog-based pet pharmacy and retail supplier under the 1-800-PetMeds brand name. The company distributes prescription and non‐prescription medications, nutritional supplements, flea and tick control products, and a range of pet health supplies directly to consumers. Through its licensed veterinary pharmacy in Delray Beach, Florida, PetMed Express fills orders for dogs, cats and other companion animals, offering both branded and generic products alongside its own private‐label formulations.

Founded in 1996 by Marc Puleo, PetMed Express built its business on the premise of convenience and cost savings for pet owners seeking reliable access to veterinary medications.