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PDCO Shares Gain Following New Deals to Boost Animal Health Business
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Patterson Companies (PDCO - Free Report) recently announced that it has signed two separate acquisition agreements for its Animal Health business, Infusion Concepts in the United Kingdom and Mountain Vet Supply in the United States.
These acquisition agreements are likely to further strengthen PDCO’s Animal Health business. Terms of the transaction are not yet disclosed. Patterson Companies expects to close the transactions during the second quarter of fiscal 2025.
Likely Trend of PDCO Stock Following the News
Following the announcement, shares of the company moved 1.8% north and closed at $21.53 on Thursday.
Patterson Companies' growing Animal Health unit is a key long-term growth driver. Management at Patterson Companies expects the global animal health supply market to continue its growth trend on the back of rising households with companion animals, increased pet adoption rates and increased expenditures on animal health. Accordingly, we anticipate the PDCO stock to gain investors’ optimism around these latest acquisitions.
For the past six months, PDCO shares have lost 22.1% compared with the industry’s decline of 7.8%. The S&P 500 increased 9.5% in the same time frame.
Meanwhile, PDCO currently has a market capitalization of $1.86 billion. It has an earnings yield of 11.02%, much higher than the industry’s yield of 5.44%.
Image Source: Zacks Investment Research
More on PDCO’s Acquisition News
Patterson Companies’ U.K. animal health business, National Veterinary Services Limited, is set to acquire Infusion Concepts, a market leader in the design and supply of infusion, drainage and critical care products that benefit the veterinary profession and their animal patients. This strategic purchase showcases Patterson Companies’ commitment to expanding its portfolio with high-quality products for its veterinary partners.
Infusion Concepts’ expertise in designing infusion pumps specifically for animals, coupled with its high-quality standards, is likely to complement PDCO’s mission of delivering excellence in animal health care for veterinarians.
Patterson Companies’ production animal business, Animal Health International, is set to acquire a majority of the operating assets related to Mountain Vet Supply, a regional distributor with a retail location headquartered in Fort Collins, CO.
Upon closing, the acquisition is expected to grow Patterson Animal Health’s presence in the production and companion animal market, drive increased operating leverage, create synergies with strategic vendors, and allow Animal Health International to provide exceptional customer service to Mountain Vet Supply’s customers.
More on Patterson Companies Past Strategic Acquisitions
Patterson Companies has been expanding its business on the back of strategic acquisitions. Since 1987, the company has acquired over 30 dental product distributors in the United States and Canada, which improved its penetration in both countries.
In 2023, Patterson Companies completed the acquisition of the Texas-based companies — Veterinary Practitioners and Animal Care Technologies (RSVP and ACT) — which provide innovative solutions to veterinary practices through data extraction and conversion, staffing and video-based training services.
The company also acquired Colorado-based Dairy Tech, providing pasteurizing equipment and single-use bags that allow dairy producers to produce, store and feed colostrum for newborn calves, as well as product offerings for beef cattle producers. These acquisitions are expected to expand PDCO’s companion animal and production animal value-added platforms by adding solutions to their suite of offerings.
Industry Prospects in Favor of PDCO
Per a report by Grand View Research, the global animal health market was valued at $62.4 billion in 2023 and is anticipated to witness a CAGR of 9% from 2024 to 2030.
Factors driving the market growth include rising animal health expenditure, the prevalence of diseases in animals, concerns over zoonoses, initiatives by key companies, uptake of pet insurance, and pet humanization.
Universal Health Service has an estimated long-term growth rate of 19%. UHS’ earnings surpassed estimates in each of the trailing four quarters, with the average being 14.58%.
Universal Health Service has gained 41.1% so far this year compared with the industry's 34.8% rise.
Quest Diagnostics has an estimated long-term growth rate of 6.20%. DGX’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 3.31%.
Quest Diagnostics shares have gained 3.7% so far this year compared with the industry’s 10.2% rise.
ABM Industries’ earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 7.34%.
ABM's shares have risen 24.1% so far this year compared with the industry’s 11.9% growth.
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PDCO Shares Gain Following New Deals to Boost Animal Health Business
Patterson Companies (PDCO - Free Report) recently announced that it has signed two separate acquisition agreements for its Animal Health business, Infusion Concepts in the United Kingdom and Mountain Vet Supply in the United States.
These acquisition agreements are likely to further strengthen PDCO’s Animal Health business. Terms of the transaction are not yet disclosed. Patterson Companies expects to close the transactions during the second quarter of fiscal 2025.
Likely Trend of PDCO Stock Following the News
Following the announcement, shares of the company moved 1.8% north and closed at $21.53 on Thursday.
Patterson Companies' growing Animal Health unit is a key long-term growth driver. Management at Patterson Companies expects the global animal health supply market to continue its growth trend on the back of rising households with companion animals, increased pet adoption rates and increased expenditures on animal health. Accordingly, we anticipate the PDCO stock to gain investors’ optimism around these latest acquisitions.
For the past six months, PDCO shares have lost 22.1% compared with the industry’s decline of 7.8%. The S&P 500 increased 9.5% in the same time frame.
Meanwhile, PDCO currently has a market capitalization of $1.86 billion. It has an earnings yield of 11.02%, much higher than the industry’s yield of 5.44%.
Image Source: Zacks Investment Research
More on PDCO’s Acquisition News
Patterson Companies’ U.K. animal health business, National Veterinary Services Limited, is set to acquire Infusion Concepts, a market leader in the design and supply of infusion, drainage and critical care products that benefit the veterinary profession and their animal patients. This strategic purchase showcases Patterson Companies’ commitment to expanding its portfolio with high-quality products for its veterinary partners.
Infusion Concepts’ expertise in designing infusion pumps specifically for animals, coupled with its high-quality standards, is likely to complement PDCO’s mission of delivering excellence in animal health care for veterinarians.
Patterson Companies’ production animal business, Animal Health International, is set to acquire a majority of the operating assets related to Mountain Vet Supply, a regional distributor with a retail location headquartered in Fort Collins, CO.
Upon closing, the acquisition is expected to grow Patterson Animal Health’s presence in the production and companion animal market, drive increased operating leverage, create synergies with strategic vendors, and allow Animal Health International to provide exceptional customer service to Mountain Vet Supply’s customers.
More on Patterson Companies Past Strategic Acquisitions
Patterson Companies has been expanding its business on the back of strategic acquisitions. Since 1987, the company has acquired over 30 dental product distributors in the United States and Canada, which improved its penetration in both countries.
In 2023, Patterson Companies completed the acquisition of the Texas-based companies — Veterinary Practitioners and Animal Care Technologies (RSVP and ACT) — which provide innovative solutions to veterinary practices through data extraction and conversion, staffing and video-based training services.
The company also acquired Colorado-based Dairy Tech, providing pasteurizing equipment and single-use bags that allow dairy producers to produce, store and feed colostrum for newborn calves, as well as product offerings for beef cattle producers. These acquisitions are expected to expand PDCO’s companion animal and production animal value-added platforms by adding solutions to their suite of offerings.
Industry Prospects in Favor of PDCO
Per a report by Grand View Research, the global animal health market was valued at $62.4 billion in 2023 and is anticipated to witness a CAGR of 9% from 2024 to 2030.
Factors driving the market growth include rising animal health expenditure, the prevalence of diseases in animals, concerns over zoonoses, initiatives by key companies, uptake of pet insurance, and pet humanization.
PDCO’s Zacks Rank & Other Stocks to Consider
PDCO carries a Zacks Rank #2 (Buy) at present.
Some other top-ranked stocks in the broader medical space are Universal Health Service (UHS - Free Report) , Quest Diagnostics (DGX - Free Report) and ABM Industries (ABM - Free Report) . While Universal Health Service sports a Zacks Rank #1 (Strong Buy), Quest Diagnostics and ABM Industries carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Universal Health Service has an estimated long-term growth rate of 19%. UHS’ earnings surpassed estimates in each of the trailing four quarters, with the average being 14.58%.
Universal Health Service has gained 41.1% so far this year compared with the industry's 34.8% rise.
Quest Diagnostics has an estimated long-term growth rate of 6.20%. DGX’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 3.31%.
Quest Diagnostics shares have gained 3.7% so far this year compared with the industry’s 10.2% rise.
ABM Industries’ earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 7.34%.
ABM's shares have risen 24.1% so far this year compared with the industry’s 11.9% growth.