Several publicly traded pet food companies have outperformed the S&P500 stock market index in 2020, while beating their own growth in 2019. Investment bank Cascadia Capital follows an index of pet food industry related stocks. The core group of Cascadia’s index beat the S&P 500 by 30% so far in 2020. That performance builds on the pet index outperforming the broader market by 203% during the past five years.
Cascadia’s market analysts reviewed the performance of these pet food makers and retailers in their report “Pet Industry Overview: Fall 2020.”
In the first half of 2020, earnings for firms in Cascadia’s pet food industry index increased 40% compared to 14.8% in the first two quarters of 2019. Individual company’s performance drove that growth more so than overall sector performance. Central Garden and PetMed Express ranked among the top earners. Publicly traded pet companies revenues grew 5.8% in 2020’s first half, compared to 7.1% in the same period of 2019. However, revenue growth excluding Zoetis, a major portion of Cascadia’s index, increased 8.0% compared to 6.3% last year.
Pet food company stocks in 2020
Not all pet food companies fared equally in earnings per share, according to Cascadia’s analysis. Emerging, growth pet food stocks tended to have lower earnings per share than established companies. Trupanion and Freshpet were profitable in the first half of 2020, but by a thin margin. PetID declined.
Pet food companies with strong equity growth so far in 2020:
- Trupanion (132%)
- Covetrus (97%)
- Freshpet (96%)
Trupanion (28%) and Freshpet (31%) also grew rapidly from a revenue perspective. Although they showed strong growth in 2020, these companies didn’t have the highest earnings per share.
