Barking Up the Right Tree: Dog Stocks

If you are looking for information about the dogs of the Dow, this is not the place.

Nor is this about the dogs of the NYSE or the dogs of the NASDAQ. This article is about dog stocks, or in other words, companies that sell to dogs (and their owners).

Last week at Madison Square Garden in New York City, The Westminster Kennel Club's 131st Annual Dog Show was held, and broadcast on the USA with a very large number of viewers. In addition, the International Kennel Club Dog show will be held at McCormick Place in Chicago this weekend. Also, The Rocky Mountain Cluster Dog Show, the largest dog show in the western United States, is also running through this weekend (Are these the dog days or what?).

Dogs are big business and are big consumers of food, toys, medical care, and numerous other pet items. There are a few ways you can sink your teeth into this investment arena without barking up the wrong tree.

Petsmart Inc. (PETM) is a Phoenix company that is one of the few publicly traded be-all and do-all companies for dogs and other pets. In addition to selling toys, food, and other products, they also offer services such as grooming, baths, toenail trimming, tooth brushing, training and boarding at their Pet Hotels, through their website and their stores. They recently agreed to buy 19 Canadian pet stores. Their earnings call is scheduled for Wednesday, February 28, 2007. Earnings estimates for the current quarter are .55 to .57, up from .47 a year ago. The stock has a P/E of 25, a price sales of 1, and even generates a small yield of almost half a percent.

On the dog medicine side of the business, there is MWI Veterinary Supply, Inc. (MWIV) which markets drugs, vaccines, equipment, supplies, pet food, and nutritional products to veterinarians. P/E is 26 and price sales of .6. There is also Patterson Companies Inc. (PDCO) which has a veterinary supply business. P/E 24, P/S 1.9.

Disclosure: Author does not own any of the above.

PETM vs. PDCO vs. MWIV 1-yr chart