Pets At Home Share Discussion Threads

[robertball] 16/8/2022 08:30

Still chugging along

[robertball] 10/8/2022 14:19

What is boosting this?

[chiefbrody] 05/8/2022 22:26

Still months of buybacks to come. With light trading over the summer months, the share price could regain some of the lost ground. Here's hoping anyway.

[mr hangman] 05/8/2022 08:27

It's also worth mentioning many pet owners have not had holidays in the past 2 years, and are taking full advantage of this year ,with their loved ones in catteries/kennels over the period of the trading statement, well done pets at home

[roguetraderuk] 05/8/2022 08:05

decent results but yes a ton of sellers pre results. prev high is close which would release a big double bottom so a massive pivot level here.

[spyder] 05/8/2022 07:51

Yes, they can put prices up so I think cost inflation can be efficiently managed.
Pet care is notoriously resilient, furthermore, PETS will benefit from pet owners looking for lower cost (but still good quality) own brand/white label food products.

[babbler] 05/8/2022 07:30

they an put prices up

[robertball] 05/8/2022 07:27

I wonder how cost inflation will feed through. Is this a defensive?

[spyder] 05/8/2022 07:25

Yes RB, good trading update from a great and under appreciated company.

[robertball] 05/8/2022 07:19

Steady as it goes

[montyhedge] 14/7/2022 15:51

It's a day when the good, bad and ugly all get hit together.

[roguetraderuk] 04/7/2022 18:09

tony, sell side holds their buys all the way to the bottom then cuts to sell. usually thats close to a bottom, as i have said abv. rare for shares to bottom whilst every sell side still with a buy rating.

[tony64cy] 04/7/2022 17:40

That the analyst backs posh trainers and magazines over a retailer that he thinks only sells cat and dog food to the "oiks", who are going to dump their pets now tough times are arriving, tells you far more about the analyst. Well it was Monday morning and his boss wanted something to publish.

[roguetraderuk] 04/7/2022 14:20

terry smith mentioned some research regarding the british approach to pets, where people were more inclined to cut back on themselves and kids before the pets. but even so, there are more strings to the bow of pets than just selling abit of dog food. however the mkt is a bear and the glass is always half empty. the good news is you need to analyst (and the firm to prompt the analysts with a warning or guide lower) to cut their numbers so that the bar gets pulled lower. historically bottoms dont happen until the sell side pulls down their estimates. so you are getting that. as for the pe, they should trade at a premium but its a question of how much. 220-240 is poss if mkt can leak further and would make a decent entry vs mkt multiple.

[yump] 04/7/2022 13:33

Its comical these “professional” analysts get paid at all.

Clearly the time to warn about an artificial spike in pet spending due to covid and an overrated share, was when this was way higher.

And clearly, there will have been a permanent hike in the number of pets owned, with only a small proportion being “let go”.

Chocolate and pets in a recession. It only takes a bit of historic research to find the patterns.

Halfords has been dumped as well for imo spurious reasons.

The question the analysts should be answering, is how much is the permanent increase in pet ownership worth to PETS.

[rudder] 04/7/2022 12:30

Tactical play if you ask me. You can not believe these public up or downgrades from these banks. Cunning bunch of pirates.

[gswredland] 04/7/2022 10:03

Thanks cari4

[babbler] 04/7/2022 09:58

yes I was surprised... ditch your pets but buy expensive trainers and newspapers which are essentials... hmmm.

[lennonsalive] 04/7/2022 09:51

Retail is under pressure, but the pressure on families to keep pets with increase in the cost of living. It's a sad thing to type, but you can just picture the animal shelters taking in animals as people can't afford to them

[don carter] 04/7/2022 09:42

I disagree with their negativity, but I'm just an amateur compared to these teenagers. 1] "Full" valuation means it's about right at £3-3.20 as it was when they wrote this; 2] eps growth in 2024 looks demanding right now but everything looks demanding right now, but 2% in '23 seems do-able; 3]they underestimate the 'priority of pets' factor in favour of trainers [JD] and magazines [WHSmith].

[spyder] 04/7/2022 09:42

Thanks cari4!
FWIW I think RBC might have some of this wrong as it seems to overlook the Vets4Pets side of the business which should be more resilient and warrants a high premium valuation cf standard UK retailers, but the market certainly seems spooked.
A challenging start for the new CEO, but perhaps there is more to this than meets the eye?

[pottsypotts] 04/7/2022 09:38

Nervous market as a broker downgrade drops a share more than a profits warning used to

[cari4] 04/7/2022 09:16

RBC Capital Markets downgraded the shares to 'underperform' from 'sector perform' and slashed the price target to 280p from 330p, partly on valuation grounds.
The bank said PETS has a strong position as a specialist player in the UK pet care market. "However, we believe valuation looks full and consensus forecasts look demanding.

"We expect further earnings growth to be more challenging to achieve given mounting pressures on the consumer and a wider spend rotation away from 'pandemic-winning' categories. Hence, we downgrade to underperform."

RBC said current consensus is looking for circa 2% earnings per share growth in FY23, with a further 12% growth in FY24. "Even with investments coming down in FY24 and PETS' more defensive offering, we think that this looks challenging to achieve, given pressured consumer budgets and margin headwinds," it said.

It noted the shares currently trade at around 15x CY23 estimated price-to-earnings, towards the middle of the historic range.

"We note that this is at a premium to others in the UK retail space, and looks demanding for a retailer with 100% UK exposure, at a time when consumer spending is under pressure," RBC said. "We have more valuation upside for some other UK retailers at these levels, such as JD Sports and WH Smith."

RBC said the company has benefited over the last two years from its market leading position in a sector that has seen strong growth. According to data from Statista, 62% of UK households now own a pet, compared to around 40% before the -pandemic, it said.

"Whilst we think that the defensive nature of pet care should provide PETS with some topline resilience, we think that further growth will now be more difficult to achieve in the light of rising cost of living and the benefits from higher spend on new pets fading away."