PetSmart Second Quarter Earnings Sneak Peek

PetSmart, Inc. (NASDAQ:PETM) will unveil its latest earnings on Wednesday, August 15, 2012. PetSmart is a specialty provider of products, services, and solutions for the lifetime needs of pets. The company offers a line of products for all the life stages of pets and offers various pet services.

PetSmart, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 65 cents per share, a rise of 20.4% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved up from 64 cents. Between one and three months ago, the average estimate moved up. It has been unchanged at 65 cents during the last month. Analysts are projecting profit to rise by 29% compared to last year’s $3.29.

Past Earnings Performance: The company has beaten estimates the last four quarters and is coming off a quarter where it topped forecasts by 12 cents, reporting net income of 85 cents per share against a mean estimate of profit of 73 cents per share.

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A Look Back: In the first quarter, profit rose 33.5% to $94.7 million (85 cents a share) from $70.9 million (61 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 9.4% to $1.63 billion from $1.49 billion.

Stock Price Performance: Between May 15, 2012 and August 9, 2012, the stock price rose $10.53 (18.3%), from $57.63 to $68.16. The stock price saw one of its best stretches over the last year between January 3, 2012 and January 12, 2012, when shares rose for eight straight days, increasing 5.2% (+$2.65) over that span. It saw one of its worst periods between May 2, 2012 and May 9, 2012 when shares fell for six straight days, dropping 4.3% (-$2.54) over that span.

Wall St. Revenue Expectations: On average, analysts predict $1.6 billion in revenue this quarter, a rise of 7.4% from the year-ago quarter. Analysts are forecasting total revenue of $6.71 billion for the year, a rise of 9.8% from last year’s revenue of $6.11 billion.

Key Stats:

This upcoming earnings announcement will be a chance to build on positive earnings momentum over the last three quarters. Net income rose 23.1% in the third quarter of the last fiscal year and 13% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 7% in the second quarter of the last fiscal year, 7.9% in the third quarter of the last fiscal year and 7.7% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

Analyst Ratings: There are mostly holds on the stock with 13 of 21 analysts surveyed giving that rating.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.83 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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