Portfolio Looking Ruff? PRISM Purrr-worthy Stock Plays on National Pet Day

If you are not a pet person and it’s not allergy related, we’d like to know what UFO you’re reading this from. Because who doesn’t love a tail wag or a meow when you walk in the door? Or maybe you’re more of a fish, reptile, or furry hamster/gerbil person, which is great because the world needs weirdos too! All kidding aside, we love our pets who’re our honorary family members. In the spirit of National Pet Day, we sat down with some furry financial expuuurts to discuss their favorite pet related stock plays.

Reesie Petunia – Foodie and Treat Aficionado

We met up to woof with Reesie in her pantry while she took inventory of her treat shelf. From pig ears to beef cheeks, Reesie touts a very impressive collection. Typically, she prefers to eat human food provided by her mom when her dad isn’t looking. However, her favorite go-to dog treats are made by Bocce’s Bakery, due to their all-natural ingredients.

When it comes to most of her stock picks, Reesie holds true to her Pitbull DNA and appreciates stocks that are misunderstood. Petco Health and Wellness Company, Inc.  (WOOF) is yet to be determined if it is misunderstood but it certainly seems troubled. The company has set the bar low however, they recently hired a new CEO and macros seem to be bottoming which may set up for an interesting turnaround story. Recent Q4 earnings, were in line with estimates reporting EPS of $0.02 vs FactSet $0.02 and revenues slightly higher at $1.7Bn vs FactSet $1.6Bn. However, Q1 guidance left investors in a head tilt.

Baguette – Energetic Exercise Enthusiast

Meeting Baguette made us howl with excitement as her energy was infectious. With a heart of gold, this mini goldendoodle didn’t quite sit down with us because it would have prohibited all the tail wags. Oui, this curly Q likes to keep her physique in tip-top shape. She shared with us her daily routine comprised of walking her small humans to the bus stop, fetching tennis, keeping eyes on her busy mom around the house and chasing her tail.

While Baguette keeps in shape, this French model doodle must also sport a diet with fewer carbs than her name implies, which is why she invests in Freshpet, Inc. (FRPT). Once known as a Zombie stock, this company now has investors licking their chops, up 74% in the past year and 28% YTD. In Freshpet’s recent Q4 earnings announcement, the company beat quarterly estimates across the board. Q4 adjusted EBITDA was $31.3M vs FactSet $27.4M and revenues were $215M vs FactSet $204.6M. They also touted FY 2024 revenue guidance of “at least” $950M vs FactSet $945.5M.

Salvare – Squeaker Extractor Extraordinaire

We sat down with Sal while he pulled every toy, he owns out of his toy box that his mom had recently put away. This Cane Corso who sports the Italian name Salvare (‘Sal’ for short) meaning Rescue, has an intimidating all muscle physique weighing in at over 100 pounds. Yet, he’s mostly known as the ‘Blueberry Booper’ due to his love for the fruit and his playful knack of giving “boops” (headbutts) led by his nose. Sal is all puppy and more play.

While we didn’t get to bark much since he was working on an intricate toy requiring much focus for precise squeaker removal, Sal indicated his pupfolio pick would be Chewy, Inc. (CHWY) who delivers him his monthly patients errr toys. This known Zombie has had some stuffing removed as its down 22% YTD, despite fundamentals seeming intact. Additionally, in the company’s recent Q4 earnings announcement, quarterly adjusted EBITDA of $86.5M vs FactSet $65.3M and positive guidance was nothing to shake a stick at, which has kept investors hopeful.

Ginger and Miki – Noble Nap Ninjas

It took us a couple of weeks to get ahold of Ginger and Miki, due to their chaotic nap schedules. In addition to that, once awake, it’s tough to pry Ginger the Hemingway Calico, away from her favorite book, The Old Man and the Sea. Miki the Tuxedo cat tends to be less formal than one would think and prefers to indulge in some “nip” when she’s not napping. The two spend their few hours awake each day differently, but share similar interests including catching mice, disregarding most people, meowing and hating the vet.

While they still may try to short it, these two felines realized to take their emotions out of investing and selected veterinarian company, Zoetis, Inc. (ZTS) as their purrrfolio pick. Earlier this year, Dow Jones cited the company to be on pace for its largest percent decrease, since November 2022. The large cap is currently down 17% YTD. The company’s  recent Q4 earnings, fell short on EPS of $1.24 vs FactSet $1.32 but beat on revenues $2.21Bn vs FactSet $2.19Bn. FY’24 EPS guidance missed and revenue was modestly below at the mid. Following this report, the EU Commission opened an investigation against Zoetis regarding potential anticompetitive conduct related to the company’s novel pain medicine for dogs. No comment has been made on if the company has nine lives.

We hope that if you play our Fido and Feline’s picks correctly, you may keep your portfolio out of the doghouse. But most importantly, we remind you to celebrate the pals who love us most by showering them extra today with lots of love and treats.

Many thanks to our PMV fuzzy friends for their wooftastic and meowing stock reviews!

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About the Author

Portfolio Looking Ruff? PRISM Purrr-worthy Stock Plays on National Pet Day

Ashlee Vogenthaler

Markets Editor