PetMed Express Beats Estimates Yet Again

Seth Jayson, The Motley Fool
Updated

PetMed Express (NAS: PETS) reported earnings on Jan. 23. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q3), PetMed Express beat expectations on revenue and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue improved, and earnings per share dropped.

Margins dropped across the board.

Revenue details
PetMed Express tallied revenue of $51 million. The seven analysts polled by S&P Capital IQ looked for revenue of $45 million. Sales were 12% higher than the prior-year quarter's $45 million.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
EPS came in at $0.19. The seven earnings estimates compiled by S&P Capital IQ forecast $0.16 per share. GAAP EPS of $0.19 for Q3 were 5.0% lower than the prior-year quarter's $0.20 per share.

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Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 34.0%, 350 basis points worse than the prior-year quarter. Operating margin was 12.1%, 350 basis points worse than the prior-year quarter. Net margin was 7.7%, 230 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $50 million. On the bottom line, the average EPS estimate is $0.17.

Next year's average estimate for revenue is $226 million. The average EPS estimate is $0.75.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 856 members out of 882 rating the stock outperform, and 26 members rating it underperform. Among 244 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 236 give PetMed Express a green thumbs-up, and eight give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on PetMed Express is underperform, with an average price target of $9.80.

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At the time thisarticle was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of PetMed Express. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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