Tags: US | PetSmart | Mover

PetSmart Shares Hit 52 Week High on Strong Outlook

Thursday, 04 Mar 2010 11:19 AM

Shares of PetSmart Inc. rose to a 52-week high Thursday after fourth-quarter earnings and strong 2010 guidance beat expectations.

Analysts said they expected merchandising and marketing initiatives as well as a recovering economy to continue lifting the chain's sales.

Shares rose $2.09, or 7.6 percent, to $29.80 in morning trading. They hit a 12-month high of $30.25 earlier in the session.

Sales of pet supplies, seasonal products and services such as grooming and adoption all improved, said Wedbush Morgan analyst Joan Storms, raising her target price on the shares by $3 to $35.

"PetSmart is the best positioned specialty pet retailer when more discretionary pet spending resumes," Storms wrote in a research note.

PetSmart has improved its private-label merchandise, partnered with name brands like Martha Stewart and focused on pet adoptions, helping offset sales declines of supplies such as leashes, said Janney analyst David Strasser in a note to clients.

He boosted his price target on the shares by $2 to $30.

Goldman analyst Matthew Fassler also raised his target price by $3 to $32, saying fewer markdowns are helping boost profit margins.

On Wednesday, the national chain based in Phoenix said it earned $75 million, or 61 cents per share, in the quarter ended in January, beating Wall Street estimates of 56 cents per share.

It also said it expects earnings of $1.73 per share to $1.83 per share for 2010, compared with the Wall Street estimate of $1.68 per share.

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Shares of PetSmart Inc. rose to a 52-week high Thursday after fourth-quarter earnings and strong 2010 guidance beat expectations.Analysts said they expected merchandising and marketing initiatives as well as a recovering economy to continue lifting the chain's sales.Shares...
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2010-19-04
Thursday, 04 Mar 2010 11:19 AM
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