Why Petco Stock Was a Good, Good Boy on Friday

Petco shares fetch impressive gains as retail investors rally behind the pet care giant.

Market Performance

Friday's trading session saw Petco stock outperform broader market indices, climbing steadily throughout the day while traditional retail stocks struggled. The surge came amid renewed investor confidence in specialty retail sectors.

Sector Momentum

Pet-focused equities continue drawing capital from funds seeking recession-resistant plays—because apparently nothing says 'safe haven' like betting on premium dog food demand during economic uncertainty.

Trading Volume Spike

Volume numbers hit unusual highs for a Friday session, suggesting both institutional and retail traders are digging into this particular bone. The activity pattern mirrors earlier moves in consumer discretionary stocks during earnings season.

Analyst Sentiment Shift

Wall Street's suddenly all ears when it comes to pet supply chains—funny how price targets get revised upward right after big funds finish accumulating positions.

Petco's rally proves yet again that in markets, sometimes it pays to think like a golden retriever: simple optimism and unwavering belief that someone will eventually throw you a treat.

A tasty treat for investors

This happened despite the fact that Petco's net sales for the period actually declined on a year-over-year basis. They fell in excess of 2% to $1.5 billion, but that was entirely expected by management. It was also a slightly higher figure than that predicted by analysts, who collectively were modeling $1.49 billion.

Image source: Getty Images.

That dip was on the back of a 1.4% fall in comparable sales for the quarter.

Petco's bottom line looked far better, as the company flipped to a generally accepted accounting principles (GAAP) net profit of almost $14 million, or $0.05 per share, from the nearly $25 million loss it suffered in the same quarter of 2024. Analysts had far more modest expectations, as the average estimate for profitability was only $0.01 per share.

In the earnings release, Petco quoted CEO Joel Anderson as saying that the first half of this year "established a solid foundation for our transformation as we continued to strengthen our economic model and improve retail operating fundamentals."

A raise in EBITDA guidance

It was a beat-and-raise quarter for Petco, as it raised its guidance for non-GAAP (adjusted) earnings before interest, taxes, depreciation, and amortization (EBITDA) for the full year. For the entirety of 2025, it's now forecasting this will range from $385 million to $395 million, on net sales down in the low-single-digit percentages from the 2024 tally.