PetSmart Cuts Q3, FY Guidance on Economic Uncertainty

| About: PetSmart, Inc (PETM)
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PetSmart cut its third-quarter and full year EPS guidance due to an "uncertain economic environment", impacted by recent consumer weakness and warmer-than-usual weather hurting sales of key cold-weather categories. PetSmart now expects Q3 EPS of $0.17 to $0.20, compared to $0.21 to $0.23 previously. Analysts were expecting EPS of $0.27. PetSmart also said it expects Q3 comparable store sales growth to come in below its original low-to-mid single digit forecast. For the year, PetSmart lowered its EPS forecast to $2.02 to $2.07, from $2.08 to $2.10 previously. Analysts were expecting $1.70/share, although this appears to exclude certain costs such as a $0.47 gain from the sale of shares of MMI Holdings. CEO Philip L. Francis acknowledged there are short-term operating challenges, but said the company feels "quite positive" about its long-term strength and still sees continued growth above its 20% target. Shares of PetSmart lost 0.6% to $32.38 on Tuesday and fell by 0.65% to $32.17 in thin after-hours trading.

Sources: Press release, Associated Press, MarketWatch
Commentary: PetSmart Continues To Deliver Despite Sector TurbulencePet Stocks: Nine Ways to Make Money From Caring for Your PetsNew Industry Trend: People Spending More On Their Pets
Stocks/ETFs to watch: PETM. ETFs: XRT
Earnings call transcript: PetSmart Q2 2007
Related: PetSmart Analyst Day Conference Webcast

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