Earnings To Watch: Petco (WOOF) Reports Q1 Results Tomorrow

Anthony Lee /
2024/05/21 3:02 am EDT

Pet-focused retailer Petco (NASDAQ:WOOF) will be reporting results tomorrow before the bell. Here's what investors should know.

Petco beat analysts' revenue expectations by 2.6% last quarter, reporting revenues of $1.67 billion, up 6.1% year on year. It was a weak quarter for the company, with underwhelming earnings guidance for the next quarter.

Is Petco a buy or sell going into earnings? Read our full analysis here, it's free.

This quarter, analysts are expecting Petco's revenue to decline 2.8% year on year to $1.51 billion, a reversal from the 5.4% increase it recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.06 per share.

Petco Total Revenue

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Petco has missed Wall Street's revenue estimates twice over the last two years.

Looking at Petco's peers in the specialty retail segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Leslie's revenues decreased 11.4% year on year, missing analysts' expectations by 6.1%, and National Vision reported revenues up 4.2%, falling short of estimates by 1.8%. Leslie's traded up 11% following the results while National Vision was down 15.3%.

Read our full analysis of Leslie's results here and National Vision's results here.

There has been positive sentiment among investors in the specialty retail segment, with share prices up 8.1% on average over the last month. Petco is up 62.8% during the same time and is heading into earnings with an average analyst price target of $2.9 (compared to the current share price of $2.54).

Today’s young investors won’t have read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next.