Posts tagged ‘pets’

Goodbye My Friend

Corky-Wade

It’s been a good run my friend, but nothing lasts forever.

I’ve worked in the world of finance and money for almost a quarter century, but as each new year passes, I appreciate the value of relationships more and more. Beating the benchmark, helping clients, and making money is still a thrilling challenge, but life has a way of periodically throwing you a curve ball to help recalibrate your perspectives on what’s important.

The Early Years

Over the last 17 years, our Beagle Border Collie mix, Corky, has been with us through thick and thin. She was a spry little pup from the day we adopted her from the local PetSmart. Corky provided surprises from the start when the store adoption volunteer told us we were the proud new parents of a masculine Rottweiler pup. That was the case until our first visit to the veterinarian, when Dr. Hardin regretfully told us, “I hate to break this to you, but your dog is not a Rottweiler…you have a Beagle mix on your hands.” Instead of a 100 pound beast, we gained a 20 pound lap dog princess. I wouldn’t have had it any other way.

There’s no replacing that special bond with your special pet.

There’s no replacing that special bond with your special pet.

The year Corky joined the family was 1998 and the Monica Lewinsky scandal was in full swing – the U.S. was also in hot pursuit of terrorist Osama bin Laden after embassy bombings in Kenya and Tanzania. A lot transpired over Corky’s 84 dog-year life, everything from job promotions and job transitions to family vacations and family deaths. In fact, Corky was part of our family four years longer than my oldest daughter.

The Special Bond

There’s a reason a dog is often considered man’s/woman’s best friend. There is a special bond between a loyal pet and its family members. The unconditional love shared between owner and pet cannot be replicated. After a bad day at work, even your best friend, sibling, or spouse has a tough time competing with a cheerful bark, wagging tail, and slobbery kiss. With dogs there is no lying, cheating, backstabbing, jealousy, yelling, mistrust, deceit, grudges, or judgment. Never have I ever heard someone say, “My dog was such a jerk yesterday, I’m definitely avoiding him (her) today.” In the disparate realm of pets, dogs are especially unique because you can’t exactly nuzzle up to a pet fish or snake. Pet owners are a unique breed as well. Would an average person pick up poop for just anyone at 5:30 am in sub -10 degree weather? Or call a dog sitter three times about his/her’s wellbeing while on a one week vacation? Probably not…but most pet owners don’t think twice when it comes to the welfare of their dog.

Corky may not have liked it, but she played along with our costume abuse.

Corky may not have liked it, but she played along with our costume abuse.

Like most pet-family relationships, the defining characteristic of the special bond usually boils down to the pets’ unique personality, and Corky certainly did not lack any personality. Corky will without a doubt be missed but like many of us, the pain and weight of old age eventually caught up to her. It was painful to watch the rapid decline. First the hearing went, then the jumping, then the sight, then the high-pitched bark, and ultimately her ability to walk.

Despite the pain, the darker times will not overshadow the many amazing and everlasting memories. Our memories may mean nothing to those who did not know Corky, but to us they mean the world.

Reminiscing: Eat, Sleep, Play

For starters, Corky’s life, like many dogs, revolved primarily around eating, sleeping, and playing – not necessarily in that order. When it came to Corky’s one-of-a-kind diet, sure she would put up with the basic dry and wet dog food, but what she would really go bananas for was…bananas! That’s right, our monkey got plenty of potassium, but in order to balance out the sweetness of bananas, she also loved the saltiness of popcorn. Corky would stand up twirling, play dead, shake your hand, or do any other trick to earn access to these special treats.

In the sleep department, Corky was willing to sleep almost anywhere, but her favorite spot was a fresh pile of warm unfolded clothes (below).

Slide1

As mentioned, playing was also a priority. Corky loved to chase rabbits, squirrels, and cats. Corky also had an affinity for unapproved field trips – usually when a crack was left open in the front door or a side gate was inadvertently left open. Maybe Corky was part cat because she displayed more than nine lives on countless occasions. Miraculously she was able to dodge cars when racing across traffic-filled intersections as mom, dad, and children attempted to chase Corky back home alive.

Needless to say, we were lucky to have had Corky for so long. Not everyone is a pet lover but almost any adult (middle-aged or younger) has experienced loss of a family member or relative. And if you haven’t faced it, you or someone else close to you will have to deal with it eventually. Those who know me closely understand I have dealt with my fair share of loss, but in each case I have gained a stronger appreciation for life and live each day with new found awareness. I continue to celebrate the memories for all my lost friends and family members…Corky included. Bananas in my cereal, and popcorn in my Cracker Jack’s will never again have the same meaning. Corky, we will miss you. Rest in peace my good friend….

Corky Lay Down

 

 

www.Sidoxia.com

Wade W. Slome, CFA, CFP®

Plan. Invest. Prosper. 

DISCLOSURE: Sidoxia Capital Management (SCM) and some of its clients hold positions in certain exchange traded funds (ETFs), but at the time of publishing, SCM had no direct position in PETM or any other security referenced in this article. No information accessed through the Investing Caffeine (IC) website constitutes investment, financial, legal, tax or other advice nor is to be relied on in making an investment or other decision. Please read disclosure language on IC Contact page.

April 12, 2015 at 3:19 pm 3 comments

From Pooches to Profits

Dog Sprawl

Oh, I’m sure you’ve seen them – those nauseating people that willingly accept facial tongue baths from their pets and dress them up in ridiculous costumes. Hey, wait a second… I guess I’m one of those annoying people too.  My wife and I were just debating which Halloween attire we should get for our dog…Cound Dogula or Barkenstein? But we are not the only fanatics humanizing our pets, as Petsmart (PETM) recently outlined in their recent analyst day. Sixty-two percent of U.S. households own a pet and if you just add up all the cats and dogs, the total reaches 171 million pets.

This is no small business – according to PETM, the industry exceeded $43 billion in 2008, spanning a whole variety of products and services, including food, veterinary care, supplies, and grooming/boarding services. PETM is collecting its growing share of the market at 14%, and I expect this share to increase over time.

What’s fueling the growth of the sector? For one, demographics is a contributor. As many Baby Boomers have become “empty-nesters” (kids move on) over time, they tend to fill that void with a pet. In addition, many working marriages have pushed having kids to the back-burner and choose to substitute a furry baby as a surrogate.

These trends have translated into vibrant growth for PETM over the years. The company has over 1,150 stores and 738 Banfield veterinary partnership locations, not to mention a significant rise in hotels. No, these are not the Four Seasons, but rather pet hotels that you can board Fido in when you take that family vacation to Hawaii or where guilt-ridden families can drop your friend off for doggy Day camp. These 156 pet hotels, which are included as part of PETM’s “Services,” continue to gain traction as they plan to open 20 new locations per year. Currently, services represents 11% of PETM’s sales (up from 8.8% in 2006), growing faster than overall sales with a significantly higher profit margins than the corporate average.

Plenty of headroom for PETM to expand in this large growing market.

Source: Petsmart 2009 Analyst Day

Not everything is peachy keen as the company acknowledges the negative impact of unemployment, lower discretionary consumer spending and higher savings rate. As a result, PETM’s high margin “Hardgoods” category has gotten clobbered lately – even with more stable sales in non-discretionary categories like “Food.” Despite the economic developments, the company is not sitting on its hands. Not only are they focusing on driving sales through store pet adoptions (approaching four million on a cumulative basis), but the company is also reaping the rewards of its Pet Perks customer database to optimize sales performance. Petsmart has even taken a page out of Costco’s (COST) book with its focus on private label brands.

Beyond sales growth initiatives, the company has also been tightening their spending belt. For example, PETM is reducing capital expenditures from 6.4% of sales ($294 million) in 2007 to an estimated 2.2% ($120 million) this year. In addition, PETM is working on process improvements, space optimization, labor scheduling, and other cost-cutting initiatives.

The fruits of these labors are creating results. Just last week at their analyst meeting, PETM raised their 2009 earnings per share forecast to a range of $1.43 – $1.51 (from previous estimate of $1.37 – $1.45). Based on 2010 Wall Street estimate of $1.54, PETM’s stock currently trades at a reasonable 16.5x P/E multiple. On a free cash flow basis, the multiple on the estimated $226 million this year is even more attractive (see my article on cash flow investing).

Halloween is just around the corner, so maybe beyond picking up a doggie cardigan for the crisp fall weather, maybe you should consider some PETM shares too.

Wade W. Slome, CFA, CFP®

Plan. Invest. Prosper.

DISCLOSURE: Sidoxia Capital Management and its client accounts have no direct position in COST shares at the time this article was originally posted. Slome Sidoxia Fund does have a long position in PETM shares at the time this article was originally posted. No information accessed through the Investing Caffeine (IC) website constitutes investment, financial, legal, tax or other advice nor is to be relied on in making an investment or other decision. Please read disclosure language on IC “Contact” page.

October 19, 2009 at 2:00 am 1 comment

The Governator: Terminate the Deficit or the Pooches?

Picture Source: Clusterstock

Picture Source: Clusterstock

The only way you get to save dollars is by saving nickels and dimes, so if saving overpaid bureaucrat wages requires Governor Arnold Schwarzenegger sending pooches to doggy heaven a little early, then so be it. California’s Legislative Analyst’s Office seems to believe $23 million can be saved by accelerating the pet euthanizing process for sheltered pets by three days.

Click Here for Article

Riding the California housing train was an enjoyable ride in California as home prices more than tripled from the late 1990s until the beginning of 2007. However, after rolling in piles of house tax collection receipts from exploding prices, the bubble based binge of tax revenue has now come to a screeching halt as home prices have declined by more than 50% from peak levels a few years ago (see chart below). Facing an 11.5% unemployment rate, the state is being kicked while it’s down on the ground – income tax collections are declining and businesses dealing with the relatively high cost of operations forcing businesses to run for the hills and leave the state.

Things obviously appear gloomy in California, but the Governator is showing his resolve to get the job done – as evidenced by his contemplation of the pet destruction option. My dog is sleeping inside tonight.

Prices Down Dramatically from Peak

Home Prices Down Dramatically from Peak

Wade W. Slome, CFA, CFP              www.Sidoxia.com

June 25, 2009 at 5:30 am Leave a comment


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