Shoppers wait in line outside a Petco pet store in Hollywood, California on April 23, 2020 during the novel coronavirus pandemic.
Robyn Beck | AFP | Getty Images
Shares of Petco health and wellness company fell more than 3% despite first-quarter earnings that exceeded Wall Street’s expectations and a raised forecast.
According to Refinitive Consensus Estimates, for the fiscal first quarter ended May 1, the company reported the following:
- Earnings per share: 17 cents adjusted compared to 9 cents expected
- Revenue: $ 1.4 billion versus $ 1.27 billion expected
For the quarter, Petco reported net income of $ 7.56 million, or 3 cents per share, compared to a loss of $ 31.2 million, or 15 cents per share, a year ago.
Without items, the company earned 17 cents per share. Analysts surveyed by Refinitiv had expected a profit of 9 cents per share.
Total revenue increased 27% from $ 1.11 billion a year ago to $ 1.41 billion, beating estimates of $ 1.27 billion.
Petco’s sales in the same store increased 28% year over year.
The retailer expects sales for this year to be between $ 5.48 billion and $ 5.58 billion, up from a previous forecast of $ 5.25 billion to $ 5.35 billion.
The earnings outlook has been raised from an earlier forecast from 63 cents to 66 cents per share to 73 to 76 cents per share.
This is the company’s second earnings report after go public again in January.
The pet trader saw growth during the pandemic with 3.3 million pet adoptions in 2020, said Ron Coughlin, CEO of Petco, in a “Squawk on the streetInterview in March. The company believes it will continue to benefit from this growth in the years to come as consumers look after their newly adopted pets.
The relocation of people moving from cities to the suburbs, too could help stimulate growth As the company expects, it gives its 1,500 stores a competitive advantage over online retailers such as Tough.
Petco is also developing its online business. Digital revenue grew 90% in the fourth quarter.
To meet demand at the start of the pandemic, the company tripled the number of ship-from-store locations and partnered with it DoorDash in December to offer same day delivery.
This story evolves and is updated.
Correction: Petco has exceeded Wall Street earnings expectations.