Moreover, both gross and operating margins declined driven by higher product and advertising costs. This is a big blow for the company, as it depends on advertising to increase its customer base. Moreover, economic uncertainty is taking a toll on the company, forcing consumers to switch to cheaper alternatives.
We do no expect the situation to improve significantly in the near future. We have lowered our estimates for 2012 and reiterate Underperform recommendation.
PETMED EXPRESS (PETS): Free Stock Analysis Report
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