Bank Of America Believes PetSmart, Inc. Has A Formidable Competitor On Its Tail

In a report published Friday, Bank of America analyst Denise Chai reiterated an Underperform rating and $55.00 price target on PetSmart, Inc. (NASDAQ: PETM).

In the report, Bank of America noted, “On Wednesday, Tractor Supply announced the opening of a new retail concept, Hometown Pet, dedicated to pet products and services such as grooming and mobile vet services. Two stores in the Nashville area will cater to a wide variety of pets and animals, including cats, dogs, poultry, birds and horses. We expect these to be small, suburban stores, as one location appears to be a former hair salon and each store will employ 12-15 people. We view this as an interesting test for TSCO because it enables it to open smaller, high-service stores in a suburban setting while gaining insights into specific needs of pet owners which could be applied to TSCO's 1,300 store base. Livestock and pet, a broad category which also includes animal-related products such as fencing, accounts for 43% of TSCO's total revenue and is a key category for both hobby farmers and rural lifestyler customers alike.”

PetSmart, Inc. closed on Thursday at $70.20.