What happened
Shares of PetMed Express, Inc. (PETS 2.01%) were soaring last month as the country's largest pet pharmacy smashed estimates in its first-quarter earnings report. According to data from S&P Global Market Intelligence, the stock rallied 52% in May.
Image source: PetMed Express.
As the chart below shows, nearly all of the gains came on May 8 after the quarterly report came out.
So what
The seller of prescription and non-prescription drugs for cats and dogs blew past estimates in its report and the stock gained 25% in a single session.
Revenue in the quarter increased 14% to $63 million, beating expectations at $56.3 million, while earnings per share jumped from $0.27 to $0.37, which cruised past the consensus at $0.26.
CEO Menderes Akdag said, "We were encouraged with increases in both new order and reorder sales during the quarter," and noted that an increase in gross margin accelerated net income growth. The company also raised its quarterly dividend from $0.19 to $0.20, equal to a 2.3% yield.
Now what
Management did not provide guidance for the quarter, but after the strong beat on the top and bottom lines, investors should expect that momentum to carry over to the coming quarters. Analysts responded to the report by raising their estimates for the rest of the year.
Pet care is a fast-growing industry with a long growth path ahead of it, and with its respectable dividend yield, PetMed Express is one of a few stocks that offer something for both growth and dividend investors.
