Covetrus Inc. (CVET) is an animal-health technology and services company dedicated to supporting the companion, equine, and large-animal veterinary markets. The company’s services include supply chain services, software solutions, and prescription management.
The company, which recently finalized its exit from parent company Henry Schein, Inc. (HSIC), beat earnings and revenue last month, with EPS up 52.9% year over year, and revenue up 10.8% to $1.13 billion. CVET’s strategy of focusing on customer engagement has enabled it to drive growth higher than its pre-COVID rates, and scale its operations by significantly investing in pharmacy capacity and innovation.
As of the latest quarter, the company had $355 million in cash, up from $68 million in the same quarter last year. Its long-term debt of $1.1 billion is high, but its current ratio is healthy at 2.1. Sales are expected to grow 4.9% next year and revenue is expected to increase by 12.2% for 2021.
The company is trading at a low valuation, with a Price to Sales ratio of 0.7 and a Price to Book ratio of 2.5. The stock has shown strong medium and long-term momentum, but weak near-term performance.
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