VCA Antech Inc. shares gained 11 percent Friday morning after an analyst upgrade on third-quarter earnings that generally met Wall Street expectations.
The Los Angeles owner of veterinary clinics and laboratories late Thursday reported net income of $30.2 million (35 cents per share), compared with $27.4 million (32 cents) in the same period a year earlier. Revenue rose less than a percent to $385 million.
The company said the results were affected by debt retirement costs of $2.8 million. Excluding one-time items, adjusted earnings per share were 37 cents. Analysts surveyed by Thomson Reuters on average expected the company to report adjusted per-share profit of 37 cents on revenue of nearly $386 million.
Animal hospital revenue rose 9.6 percent to more than $303 million, with laboratory revenue up 2.2 percent to $79 million.
“Although we continue to face a challenging business environment, we have been able to grow both organic animal hospital and laboratory revenues during the quarter,” said Chief Executive Bob Antin in a statement. “We continue to be optimistic regarding the future prospects of the companion animal health care industry.”
Stephens & Co. on Friday raised its recommendation on shares from “equal weight” to “over-weight” in anticipation of sustained sales growth for the company as the economy improves and pet owners feel more confident about spending more at the vet.
Shares were up $1.99, or 11 percent, to $20.35 in Friday midday trading on the Nasdaq.