Though veterinary hospital operator VCA Antech Inc. slightly missed analysts’ earning expectations last week, Wall Street is not about to put down the company.

After all, American pet owners are usually willing to spend at the vet’s office, and there is mounting evidence pocketbooks are opening.

Still, analysts are a bit cautious given the discretionary nature of many animal hospital expenditures, such as checkups and teeth cleanings.

“We believe (VCA Antech) is structurally well positioned to take advantage of recovery,” wrote Arthur Henderson, an analyst at New York-based banking investment firm Jefferies & Co. “However we believe the return of volume growth could come slower than some investors expect, given the relatively higher average ticket for veterinary services compared to other consumer/retail segments.”

Henderson is one of five analysts that rate VCA Antech company a “hold,” while four rate it a “buy” and one a “sell,” according to Bloomberg News.

Last week, the West L.A. company reported a 5 percent revenue increase to $331 million that was better than analysts expected. But higher costs curbed the bottom line, dropping net income less than 1 percent to $31.9 million. On a per-share basis, earnings were 37 cents, just below Wall Street’s average expectation of 38 cents.

The company reaffirmed its full-year 2010 guidance of net income between $1.60 and $1.68 per share. Revenue is expected to be $1.39 billion to $1.42 billion. Analysts on average are expecting earnings of $1.64 per share and revenue of $1.39 billion.

“We’re living in a recovering world,” Chief Executive Robert Antin said during a conference call last week. “It will be a gradual improvement and I think if the economy continues to improve in the direction it’s going … we’ll be the beneficiary.”

After the earnings announcement, VCA Antech’s stock – the ticker symbol is WOOF – jumped by $1 to more than $29 a share. It soon settled down and closed April 29 at $28.70.

VCA Antech, which was on a veterinary hospital buying spree before the recession hit, only added four hospitals in the quarter, bringing its total to 489 locations nationwide. The company generally targets mature practices with owners either nearing retirement age or looking to get some cash out of the business.

The company also has a growing laboratory testing business, and last year bought a diagnostic equipment manufacturer to take advantage of growing interest by vets to convert to digital X-rays. Growth in that sector, however, was slowed by the credit crunch.

Also, direct costs during the quarter rose 6 percent to nearly $245 million. Chief Financial Officer Tomas Fuller said during the conference call that staff reductions and other cost-cutting moves have reached the limit of their effectiveness in holding margins steady in the economic downturn.

At least one analyst was forgiving on that point.

“VCA’s performance given economic pressure (is) impressive,” said Robert Mains, an analyst at Birmingham, Ala.-based investment firm Morgan Keegan who has a “market perform” recommendation on shares. “This speaks to both the company’s cost containment acumen and the accretive nature of its acquisitions.”

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