|Written by GSCR Staff|
|Wednesday, 05 August 2015 06:46|
In Monday’s Guide we reviewed some data that showed August has not been the ‘bad’ month it is made out to be. Yesterday, MarketWatch expanded on this theme in this article.
This was an interesting article, but we will be honest here. The picture of Rodney Dangerfield is what caught our attention. I would request some of our younger readers to look some of his 70’s stand-up on YouTube. Classic!
In this week’s Guide we also mentioned the dog days of the summer with a cuddly picture of a puppy. There is no doubt people’s pets are super important to them, as people are spending money on major surgery, acupuncture and other exotic procedures to keep Fido around. Sometimes you have to wonder if it has gone too far. Surely anyone who has turned on a TV over the last week has seen the story of the slaying of Cecil the Lion in Zimbabwe by a Minnesota dentist who remains in hiding. By no means are we big game hunting advocates, but it seems this story and the public outcry was bigger than a lot of human tragedies. But we digress. We have to find a way to play this shift in values in the stock market.
PetMed Express, Inc. (NASDAQ – PETS - $16.95) is often called the “Amazon” of the pet supplies world. The Company and its subsidiaries, doing business as 1-800-PetMeds, operates as a pet pharmacy in the United States. The Company markets prescription and non-prescription pet medications, health products, and supplies for dogs and cats to retail customers. It offers non-prescription medications and supplies, including flea and tick control products, bone and joint care products, vitamins, treats, nutritional supplements, hygiene products, and supplies; and prescription medications, such as heartworm preventatives, arthritis, thyroid, diabetes, pain medications, antibiotics, and other specialty medications, as well as generic substitutes. The Company also sells food, beds, crates, stairs, strollers, and other pet supplies through its Website.
The chart below shows that PETS has been on a nice one year momentum rise and is currently trading right at the 50-day EMA.
PETS 1-Year Chart, 50-Day EMA
One item that we have been hot on recently is firm debt. As of the end of June, PetMed Express has zero debt. Financial reporting, particularly EPS has been something we view as important right now. The Company beat EPS estimates for its FYQ1 2016 reporting coming at $0.29 per shares versus the $0.28 estimate.
PETS is a solid play on the macroeconomic phenomenon of increased spending on house pets in the U.S. The stock is approaching the 52-week high of $17.15. If the stock breaks thru this resistance level it could run up to $19 this year.
Have a great day!
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