(PETS) PetMed Express – Bear of the Day

PetMed Express (PETS) reported a disappointing quarter with EPS of $0.19, missing the Zacks Consensus Estimate of $0.22 and the year-ago quarter’s $0.27. While new order sales declined on fewer new customers, revenues increased 1.2% to $50.9 million.

Both gross and operating margins declined due to higher product and advertising costs. This is a big blow for the company as it depends heavily on advertising to expand its customer base. Moreover, economic uncertainty is taking a toll on the company, forcing consumers to switch to cheaper alternatives.

We do not expect the situation to improve significantly in the near future. We maintain our Underperform recommendation on the stock.

PETMED EXPRESS (PETS): Free Stock Analysis Report

Zacks Investment Research

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