Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, nationwide pet pharmacy PetMed Express
With that in mind, let's take a closer look at PetMed's business and see what CAPS investors are saying about the stock right now.
|Headquarters (Founded)||Pompano Beach, Fla. (1996)|
|Market Cap||$329.5 million|
|Trailing-12-Month Revenue||$231.03 million|
CEO Menderes Akdag (since 2001)
CFO Bruce Rosenbloom (since 2001)
|Return on Equity (Average, Past 3 Years)||27.6%|
|Cash/Debt||$71.3 million / $0|
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
Late last year, feynmanshomeboy tapped PetMed as a true top dog: "Growth in sector this decade will come from prescriptions (and maybe even cuter outfits). The streamlined delivery of prescription drugs to customers in all 50 states will make this company a sector leader or an attractive acquisition."
In fact, PetMed boasts a rather robust three-year average operating margin of 16%. That's easily higher than that of increasingly fierce foes like Amazon (4.3%), PetSmart (7.3%), and Wal-Mart (5.9%).
CAPS member tekennedy elaborates on the bull case:
it is the industry leader in a very fragmented industry with scale benefits. This company competes primarily with vets, which constitute over 70% of the market. This is a difficult type of competitor as a large number of people will naturally just purchase their pet medications through them because the customer needs to get the prescription from them. ... Despite this [Petmed] has managed to become the largest (estimated 7% of market) player in the market, larger than all other mail order companies combined. ...
I expect over the long term the company should be able to continue to earn high returns on equity and continue to grow. In the short run they hit a small speed bump. The company's cost to acquire a new customer has increased due to higher advertising pricing. ... Although growth may diminish in the near term I expect the company to continue gaining share over the long term.
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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Amazon and PetSmart are Motley Fool Stock Advisor picks. Wal-Mart is a choice of both Inside Value and Global Gains. The Fool owns shares of PetMed Express and Wal-Mart. Try any of our Foolish newsletter services free for 30 days.
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