In major news on UK stocks, shares of Pets at Home Group PLC (GB:PETS) fell as vet pricing has come under the scrutiny of a UK watchdog on overcharging concerns. The Competition and Markets Authority (CMA) today announced that it is gearing up to initiate a formal investigation into the UK veterinary market over “multiple concerns,” including overcharging. PETS stock fell by over 4% at the time of writing, taking the year-to-date loss to almost 14%.
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Pets at Home is a leading specialist retailer in the UK pet industry, offering a wide range of quality products and services for pet care.
CMA Flags Concerns in the Vets Market
Today’s announcement follows the initial review launched in September 2023, considering the significance of the sector to the UK’s 16 million pet owners. CMA found various issues, such as giving incomplete information to consumers, consolidation in the sector, weak competition in certain areas, overpricing of medicines, and outdated regulations.
Consequently, the CMA has invited feedback from the sector on its proposal to launch a formal investigation.
In January, Pets at Home released its trading statement for the third quarter of FY24. The company’s consumer revenue increased by 6% in Q3 compared to last year. This growth was driven by an increase in average customer spending and a 2% year-over-year rise in active VIP members to 7.7 million.
The company will release a pre-close update by the end of this month.
What is the Analyst Consensus for Pets at Home?
The news came as a blow to big vet companies, impacting their share prices. Stocks in the UK vet market could remain volatile until further developments arise.
On TipRanks, PETS stock has received a Hold consensus rating, backed by one Buy, one Hold, and one Sell recommendation. The Pets at Home share price target is 358.3p, which is 32.7% higher than the current trading level.
