Pet foods and Health

By pjain      Published July 7, 2021, 5:07 a.m. in blog Invest   

Pet Care Trends, Keys

Stock Investing - PHSE

While the growth narrative for pet stocks is very much real, again, so many people have caught onto it. In other words, good deals are hard to find in this sector.

American Pet Products Association (APPA), pet parents — using the lexicon that many folks prefer — spent a total of $95.7 billion on their four-legged companions last year. That breaks down to $36.9 billion for pet food/treats, $19.2 billion for supplies/live animals/over-the-counter medicine, $29.3 billion for veterinary care and $10.3 billion for other services (which includes boarding and grooming).

  • 80% Generation Z even more pet members ages 11 to 17 stated they have a pet in the home. Likely, they will carry this experience into adulthood, which bodes very well for pet stocks to buy.

  • Share of cat ownership (and small dog) to rise with Aging. Among those ages 18 to 29 years and 30 to 49 years is very stable. However, an uptick occurs in the 50 to 64 years category, suggesting aging leads to higher probabilities of cat ownership.

Health conscious - willing to pay up for food quality!

Majority - feed cheap food eg my dogs dog food, the kind that you buy by the metric ton and that resembles stale cereal, only with a putrid odor.

C19 run on pets - animal companionship has been a vital coping mechanism, which further bolsters the case for pet stocks. During this year of lockdowns and mitigation protocols, it’s likely that pet owners, particularly millennials, grew even more attached to their pets.

Pet Meds, Care, Diagnostics, Insurance

ZTS IDXX LMND PETQ PETS

ZTS x PHSE=13x 5y$ 7%,eps 38% de=1.8

Zoetis

  • V VOLATILE, On a year-to-date basis, ZTS stock is up nearly 22% as pet owners did whatever they could to keep their four-legged family members healthy and safe.

World’s largest producer of medicine and vaccinations for pets and livestock

IDXX x PHSE=19x 5y$ 11% eps=27% de=1.3

  • FY'21 High Profit Margins gm 56% and raised 25%
  • Full yr $ 2021 3.`b
  • v: Year 84%

  • FY'20

  • Revenue Q1 $2.7 b y+12%

    • 16% growth in its companion animal group (CAG) diagnostics revenue.
    • C19 slowed placement of the company's diagnostic equipment in veterinary offices
    • Sales strong consumable sales and increased sales in the company's rapid assay tests.
  • About: Idexx Laboratories global leader in diagnostics and veterinary services software, Idexx represents the cutting edge of pet care, specifically preventative care.

  • focuses on veterinary diagnostics, veterinary practice software, water microbiology testing

LMND Xx PHSE=73x 5y$ - e -, e5yf 13%

Lemonade: insurance via an apps - RENTAL insurance not really for pets

CORE: Primarily geared toward millennials, the company is best known for its renters’ and homeowners’ insurance. But it’s also pushing its way into the pet insurance game, making LMND stock quite compelling. - caters to millennials important as Reddit/Robinhood generation app-for-everything lifestyle

PETQ R9 ph=19x M=1.2b $0.9b 5y $31x Epsf5 25% de=1.8 Bleeding EPS-3,f=$2

b32 m 25

  • retail VETs
  • ABOUT: PetIQ pet medication and wellness company. It operates in two segments, Products and Services. The company offers Rx pet medications, which include heartworm preventatives, arthritis, thyroid, diabetes and pain treatments, antibiotics, and other specialty medications; and co-develops and manufactures its own proprietary value-branded products, as well as distributes third-party branded medications. It also provides OTC medications and supplies primarily within the flea and tick control, and behavior management categories of the health and wellness industry in various forms, such as spot on (topical) treatments, chewables, oral tablets, and collars. In addition, the company offers health and wellness products that include dental treats and nutritional supplements, which comprise hip and joint, vitamins, and skin and coat products. The company provides its products primarily under the PetIQ, PetArmor, VIP Petcare, VetIQ PetCare, VetIQ, Capstar, Advecta, SENTRY, Sergeants, PetLock, Heart Shield Plus, TruProfen, Betsy Farms, PetAction, Minties, Vera, and Delightibles brands. In addition, the company offers a suite of services at community clinics and wellness centers hosted at pet retailers across 41 states, including diagnostic tests, vaccinations, prescription medications, microchipping, and wellness checks. It operates through approximately 60,000 points of distribution across veterinarian, retail, and e-commerce channels. The company was founded in 2010 and is headquartered in Eagle, Idaho.

Billing itself as an advocate for pet parents, PetIQ offers a vertically integrated business that covers the many essentials for humans to better care for their furry companions, from premium-grade pet products to veterinary services.

SEG: MEDS PetIQ’s branded medications are available through 60,000 retail and e-commerce sites, making this one of the most comprehensive names among pet stocks to buy.

SEG: VIP Petcare division veterinary services @ bigbox like WMT,TGT - deserves its own consideration as one of the pet stocks to consider thanks to its pro-pet policy.

PETS R9

  • FY'20
  • HIGH mid-July just as second wave hit, then fell into a negative trend channel

PetMed Express PetMed Express levered to online sales of pet medication and health supplies, could the coronavirus spark the next big rally in PETS? I don’t think it’s out of the question. With so much devastation rippling through the country, everyone now sees firsthand what complacency in a pandemic will do to you.

HSKA

Heska is branching out Heska's shares have climbed more than 70% over the past year. The company makes veterinary diagnostic and specialty healthcare products such as hematology analyzers and radiographs, plus consumables such as allergy shots and heartworm prevention products.

Heska's 2020 culminated in a fourth quarter with reported revenue of $64.3 million -- 90.5% over what it was in the same quarter in 2019. For the year, revenue was listed at $197.3 million, up 60.9% year over year. The company was focused on acquisitions in 2020, so it lost $14.4 million for the year, but in the fourth quarter, it bore fruit in the form of $2.5 million in net income.

In 2020, Heska broadened its international scope with the $110 million purchase of the scil animal care company ("scil"), a maker of veterinary orthopedic implants, surgical instruments, dental supplies, and laboratory reagents and supplies that was headquartered in Germany, but did business in 24 countries. Heska also bought Spanish veterinary imaging and blood-testing company CVM.

The acquisition binge continued this January, when the company announced it was buying Lacuna Diagnostics, which specializes in point-of-care diagnostics, digital cytology, and telemedicine, giving Heska an entry into the telemedicine and professional services markets.

Heska Executive Vice President and CFO Catherine Grassman said on the company's fourth-quarter earnings call that she expects 2021 revenue to come in between $225 million and $235 million. Heska CEO and President Kevin Wilson provided even more optimism, remarking that he expects the company to do $250 million in sales in 2022.

Pet Bulk Supplies

CHD

Church & Dwight

  • Cat-care market through its Arm & Hammer brand of kitty litter.
  • Share of cat ownership among those ages 18 to 29 years and 30 to 49 years is very stable. However, an uptick occurs in the 50 to 64 years category, suggesting aging leads to higher probabilities of cat ownership.

Pet food

CHWY phse EC

Chewy

One of the top online retailers of pet food and supplies, Chewy enjoyed an obvious catalyst due to Covid-19. For one thing, the human component of this special relationship was at great health risk. Therefore, the push toward contactless delivery options benefited CHWY stock. As well, because the crisis doesn’t appear to be abating anytime soon, Chewy has perhaps become the most relevant name among pet stocks.

But CHWY stock also offers a play on the other end of the equation. While the world is mostly concerned about human-to-human transmission, the Centers for Disease Control notes that a risk exists that cats and dogs can be infected with SARS-CoV-2. The available data suggests that the probability is very small. However, you know how pet owners are. Thus, Chewy provides a double benefit.

FRPT phse HEALTH VEGGIE

  • FY'21
  • v stock is up over 140% year-to-date 2021

  • ABOUT: FreshPet CORE: pets with premium quality food

  • 100% natural farm-raised poultry, beef and fish, fiber-packed garden veggies/ antioxidant fruits

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