Pet supply retailer PETsMART
On the strength of high-margin services and the popularity of premium pet supplies, the company reported net income of $0.39 per share, or $57.2 million, as compared to $0.17 per share, or $24.6 million, in the same quarter a year ago. Same-store sales increased nearly 8% for the quarter, and total sales were up 13% to $839.7 million.
Anyone who doesn't have pets might expect the usual fare at a retailer like PETsMART, such as dog and cat food, litter, leashes, and scratching posts. Most of these can be purchased at your neighborhood Wal-Mart
Going forward, management expects fiscal 2004 earnings of $1.14 to $1.15 per share, with same-store sales up 7%. And speaking of going forward, depending on the continued good mood of the consumer, pet supplies seem a lucrative market to think about in an improving economy. According to the American Veterinary Medical Association, there are more than 60 million pet dogs and nearly 70 million pet cats in the U.S. That's a lot of puppy and kitten chow.
As you've probably noticed, many of those pets are as coddled as kids, and last holiday's news coverage touched on a season that included a strong emphasis on gifts for Fluffy and Fido. (I have to admit, the two cats in my household had some holiday toys in their stockings from PETsMART rival Petco
It's hard to tell why PETsMART shares didn't thrill today. One possibility is that the 12.5% increase in share price over the last several weeks already factored in a strong quarterly showing. And at its high today, the stock was only 6.6% off its 52-week peak. However, trends in pet ownership -- and pet spoiling -- may be worth some attention if the economy continues to pick up.
Is nothing too good for your pets? Talk to like-minded Fools on the Pet Lovers discussion board.
Alyce Lomax does not own shares of any companies mentioned. One day, she'd like to ask the Pet Psychic why empty boxes, candy wrappers, and rubber bands are more entertaining than catnip mice.