Pet-focused retailer Petco (NASDAQ: WOOF) will be announcing earnings results this Wednesday after market hours. Here’s what to expect.
Petco beat analysts’ revenue expectations last quarter, reporting revenues of $1.50 billion, flat year on year. It was a mixed quarter for the company, with a solid beat of analysts’ EBITDA estimates but EPS in line with analysts’ estimates.
Is Petco a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Petco’s revenue to be flat year on year, improving from the 2.3% decrease it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Petco has missed Wall Street’s revenue estimates multiple times over the last two years.
Looking at Petco’s peers in the consumer retail segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Tractor Supply delivered year-on-year revenue growth of 2.3%, missing analysts’ expectations by 1.1%, and Leslie's reported a revenue decline of 8.4%, falling short of estimates by 11.9%. Tractor Supply traded up 5.7% following the results while Leslie's was down 41.7%.
Read our full analysis of Tractor Supply’s results here and Leslie’s results here.
In the last twelve months or so, the market has shifted its attention from one area of macro importance to the next (AI disintermediation and AI capex spending to geopolitical conflict, rates, and whether the economy is on solid footing or not). While some of the consumer retail stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 3.2% on average over the last month. Petco is down 7.9% during the same time and is heading into earnings with an average analyst price target of $3.54 (compared to the current share price of $2.68).
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