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Bull of the Day: PetMed Express (PETS)

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With the NASDAQ Composite breaking down over the last several days it feels weird to name a NASDAQ stock as my Bull of the Day. However, while the tech-heavy index has succumbed to selling pressure since early June, this stock has held its own. That sort of relative strength in the face of a depressed investment landscape is one of the many reasons this stock is at the top of my list.

PetMed Express (PETS - Free Report) Operates as a pet pharmacy in the United States. The company markets prescription and non-prescription pet medications, health products, and supplies for dogs and cats to retail customers. It provides non-prescription medications and supplies, such as flea and tick control products, bone and joint care products, vitamins, treats, nutritional supplements, hygiene products, and supplies; and prescription medications, including heartworm preventatives, flea and tick preventatives, arthritis, thyroid, diabetes, pain medications, antibiotics, and other specialty medications, as well as generic substitutes. 

PetMed Express is a Zacks Rank #1 (Strong Buy) stock in an industry that’s currently ranked in the Top 16% of our Zacks Industry Rank. It also has a Growth Style Score of B. Part of the reason for the favorable Zacks Rank is the recent earnings estimate revisions analysts have made over the last 30 days. The bullishness of these revisions can be seen in the change of our Zacks Consensus Estimates. Just 60 days go, analysts were expecting 33 cents EPS for the current quarter and $1.10 for the current year. This number has jumped to 40 cents for the current quarter and $1.25 for the year as a direct result of positive earnings estimate revisions.

The chart for PETS shows steady accumulation for the sock from March through April of this year. After a great earnings report in early May, shares exploded higher, breaking through resistance at $24 and closing near $30 the day after the report. Shares continued to surge higher, eventually stopping to catch their breath with shares bouncing off $42. The stock has retraced its steps a bit in the last couple of weeks but is still very much within striking distance of the highs.

Support levels in the short-term include the 50-day moving average near $34.50 as well as the bullish trend line support which extends itself near $36. With the commodity channel index showing a recent “Sell” signal while crossing down below the zero line, I’d wait for a bounce from oversold levels to initiate a position

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