One-glance verdict
Undervalued
$33.77 our estimate vs market $1.67
Wall Street consensus: $2.15 (-93.6% lower than our fair-value estimate)
95% below our estimate, below the bear case
Fundamentals snapshot
PetMed Express, Inc.
PETS · NMS · Healthcare · Pharmaceutical Retailers
Current price
$1.67
52-week range
$1.57 - $4.10
Market cap
$36.20M
Balance sheet
Healthy
-69.81x Concerning
Net cash $12.66M. Interest coverage shows how many times profit covers the interest bill.
What stands out
1 Reward
2 Risks
1 rewards · 2 risks
- Reward Free cash flow was positive in 7/10 years.
- Risk Return on equity was -78.6% last year — the company lost money on shareholders' equity.
- Risk Operating margin compressed from 8.9% to -15.2% over 3 years.
What this company does
PetMed Express, Inc.
PetMed Express is an online pet pharmacy, basically a CVS for your dog, cat, or horse, that sells prescription medications and other supplies directly to you. The company makes a large portion of its money from recurring revenue (sales from products customers must buy over and over again, like monthly flea and tick prevention), which can create a predictable stream of income. This model depends on pet owners choosing the convenience of ordering online over buying directly from their vet.
How the company got here
Founded in 1996 by an anesthesiologist, PetMed Express started as a mail-order business for pet medications and accessories. The company, also known as PetMeds, shifted its focus to primarily pet medicines and grew through television commercials and catalogs. It became a publicly traded company and eventually evolved from a telephone-based service to a more digitally-focused online pet pharmacy. Over the years, it has expanded its offerings and acquired other companies, like PetCareRx, to grow its customer base and product selection.
What it actually does
PetMed Express operates as an online pet pharmacy, selling prescription and non-prescription medications, health products, and supplies for dogs, cats, and horses directly to pet owners. Think of it as an online drugstore for your pets, where you can buy items like flea and tick control, heartworm preventatives, vitamins, nutritional supplements, and even special pet food. They sell these products through their website, mobile app, and customer support center, delivering them to customers across the United States.
Online Pet Pharmacy and Supplies
This is the company's main and only line of business; it operates as a single unit focused on selling pet health products. They generate revenue (the money a company brings in from sales) by selling both prescription medications, which require a veterinarian's approval, and non-prescription items like supplements and pet supplies. A large portion of their sales comes from reorders by existing customers, showing that many pet owners use their service repeatedly for their pets' needs. The company makes money by purchasing these products from manufacturers and distributors and selling them to pet owners at a markup.
What management is betting on now
The company's leadership is focused on improving the customer experience and making their operations more efficient to return to profitability. They are investing in technology, expanding their product offerings to include things like grooming and wellness services, and forming partnerships to reach more customers. A key strategy is to increase the number of customers who sign up for AutoShip, a subscription service for regularly needed medications and supplies, which creates a more predictable stream of revenue. They are also exploring new ways to attract customers, such as a partnership with the retail chain Rural King to offer an online pharmacy to their shoppers.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2025 Q2
$6.12M
FY2025 Q3
$-1.94M
FY2025 Q4
$4.62M
FY2026 Q1
$-13.56M
FY2026 Q2
$-4.80M
FY2026 Q3
$-9.23M
FY2026 Q4
$-5.46M
FY2027 Q1
$-8.33M
Revenue
$41.02M
Net income
$-6.14M
Diluted EPS
-0.28
Operating cash flow
$-7.69M
Free cash flow
$-8.33M
Fetching…
Sources
Revenue
$42.82M
Net income
$-4.06M
Diluted EPS
-0.18
Operating cash flow
$-4.74M
Free cash flow
$-5.46M
Fetching…
Sources
Revenue
$40.66M
Net income
$-10.55M
Diluted EPS
-0.50
Operating cash flow
$-9.21M
Free cash flow
$-9.23M
Fetching…
Sources
Revenue
$44.36M
Net income
$-8.52M
Diluted EPS
-0.41
Operating cash flow
$-2.17M
Free cash flow
$-4.80M
Fetching…
Sources
Revenue
$51.18M
Net income
$-34.15M
Diluted EPS
-1.65
Operating cash flow
$-12.27M
Free cash flow
$-13.56M
Fetching…
Sources
Revenue
$46.47M
Net income
$-11.64M
Diluted EPS
-0.56
Operating cash flow
$7.01M
Free cash flow
$4.62M
Fetching…
Sources
Revenue
$52.98M
Net income
$-707.00K
Diluted EPS
-0.03
Operating cash flow
$-1.17M
Free cash flow
$-1.94M
Fetching…
Sources
Revenue
$59.57M
Net income
$2.33M
Diluted EPS
0.11
Operating cash flow
$7.39M
Free cash flow
$6.12M
Fetching…
Sources
Is it cheap or expensive?
Fair value $33.77 vs current price $1.67
Wall Street consensus is the average analyst price target: $2.15 (-93.6% lower than our fair-value estimate).
Our most-likely fair value is $33.77 a share — about 1,922.0% above today's price of $1.67, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net cash $12.7M - more cash than debt. Interest coverage -69.8x.
Net debt
$-12.66M
Interest coverage
-69.81x
PetMed Express, Inc.'s profit covers its interest bill about 0.0 times over. which is weaker than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
PETS
BASELINE
PetMed Express, Inc.
Total debt $414.00K Interest coverage -69.81x This is the baseline the peer rows are being compared against.
Total debt $1.16B Interest coverage 55.28x This peer still has a real interest-payment cushion, while PETS does not.
Total debt $36.23M Interest coverage -21.65x Neither company has much profit cushion over interest right now.
Total debt $493.66M Interest coverage 5.36x This peer still has a real interest-payment cushion, while PETS does not.
Total debt $106.91M Interest coverage 7.32x This peer still has a real interest-payment cushion, while PETS does not.
Total debt $1.41B Interest coverage 4.33x This peer still has a real interest-payment cushion, while PETS does not.
What you should know
The case for and against PETS
1 Reward
2 Risks
Rewards
-
Free cash flow was positive in 7/10 years.
Risks
-
Return on equity was -78.6% last year — the company lost money on shareholders' equity.
-
Operating margin compressed from 8.9% to -15.2% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
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Forward P/E
-55.67x
P/B
1.53x
P/S
0.21x
EV/EBITDA
-1.21x
PEG ratio
2.32x
Profitability
How much profit each dollar creates
Gross margin
27.9%
Operating margin
-15.2%
Net margin
-17.3%
ROE
-78.6%
ROA
-20.0%
Health
Liquidity and balance-sheet strength
Debt / equity
0.02x
Current ratio
0.68x
Quick ratio
0.36x
Total debt
$414.00K
Total cash
$13.08M
Growth
How the business has been compounding
Revenue TTM
$168.86M
Revenue 5Y CAGR
-1.2%
EPS TTM
-1.37
EPS 5Y CAGR
—
Cash flow
How much cash the business throws off
Operating CF TTM
$-23.81M
Free CF TTM
$-33.01M
FCF margin
-19.5%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
2023-08-11