PetMed Express, Inc. Beat Analyst Profit Forecasts, And Analysts Have New Estimates

There's been a notable change in appetite for PetMed Express, Inc. (NASDAQ:PETS) shares in the week since its first-quarter report, with the stock down 14% to US$3.26. Revenues of US$68m reported a marginal miss, falling short of forecasts by 9.4%, but earnings were better than expected - statutory profits came in at US$0.18 per share, a nice change from the loss the analysts expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for PetMed Express

Taking into account the latest results, PetMed Express' dual analysts currently expect revenues in 2025 to be US$266.5m, approximately in line with the last 12 months. Losses are forecast to balloon 116% to US$0.28 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$281.3m and losses of US$0.22 per share in 2025. So it's pretty clear the analysts have mixed opinions on PetMed Express after this update; revenues were downgraded and per-share losses expected to increase.

The consensus price target fell 33% to US$3.50, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook.

Of course, another way to look at these forecasts is to place them into context against the industry itself. One more thing stood out to us about these estimates, and it's the idea that PetMed Express' decline is expected to accelerate, with revenues forecast to fall at an annualised rate of 2.1% to the end of 2025. This tops off a historical decline of 1.7% a year over the past five years. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 4.8% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect PetMed Express to suffer worse than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2027, which can be seen for free on our platform here.

You still need to take note of risks, for example - PetMed Express has 1 warning sign we think you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.