PetIQ posted revenue increases in both its Products and Services segments during the second quarter. The company opened 17 wellness centers and three regional offices during the quarter, marking the completion of all 20 VetIQ wellness centers.
In the second quarter, the company raised its full-year 2018 consolidated net sales guidance to approx. $500 million, reflecting a year-over-year increase of around 88%. Adjusted EBITDA is expected to come in a range of $40 million to $45 million, reflecting an increase of 79% to 102% year-over-year.
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In October, PetIQ acquired pet supplements-maker HBH Enterprises, in a cash-and-stock deal. The transaction is not expected to materially impact fourth-quarter 2018 results, so the full-year guidance remains unchanged. The deal is expected to be accretive in 2019.
The momentum from the company’s product and service offerings as well as its new wellness centers is likely to continue for the third quarter and can be helpful in driving growth. Updates relating to the new HBH subsidiary are another area to keep an eye on. Overall, PetIQ appears to be on track to deliver another earnings surprise for the third quarter.
PetIQ’s stock has gained 54% so far this year and looking at the past three months, the stock has climbed 23%. If the company beats estimates for the third quarter, the stock is likely to get a lift.