Home/Blog/Trading Ideas/Happy Holidays On Tap For Fido and Fluffy

Happy Holidays On Tap For Fido and Fluffy

13 December 2012 in Trading Ideas

Just as they do in shopping for their kids, adult consumers make sure that their pets are well taken care of during the holiday season – and this year is expected to be no different.

According to a recent national pet owners survey by the American Pet Products Association, 53% of dogs and 38% of cats receive gifts at Christmas.

“We’ve already seen that pet owners reward their pets and purchase holiday gifts for them in even the toughest of economic times,” said Bob Vetere, president of the APPA, in a press release last month. “With retailers and researchers expecting the 2012 holiday shopping season to be even better than last year, we have positive expectations for the pet industry.”

The industry was basing its optimism in part on a survey by management consulting firm Hay Group, which found that 75% of retail “leaders” predicted 2012 sales for the Christmas shopping season will be higher than they were in 2011. And, contrary to what they had done for most of 2012, half of respondents said they expected to achieve the higher sales without the deep discounting strategies they needed a year ago.

However, it’s not clear that those holiday sales have delivered. As the New York Times reported on Nov. 30, same-store sales at major American store chains, including Macy’s (M), Nordstrom (JWN), Kohl’s (KSS) and Target (TGT) , declined in November, which, of course, includes Black Friday and Cyber Monday, the official kickoff of the critical holiday shopping season for retailers.

On the other hand, overall spending on pets has appeared to be a stable grower, at least for the near term. The APPA estimates that total pet spending in the US will grow 3.7% from a year ago to $52.9 billion in 2012. The Pet Passion motif, which is a collection of stocks of companies in the pet products and services market, is up 3.7% in the past month.

Cats across America can only hope their gift underperformance compared to their canine peers diminishes this year.

Performance data was as of 12/13/2012. Performance data and returns are based on past performance and are not representative of results an investor could expect to achieve. The 1-month and 3-month return shows how a particular benchmark motif could have performed over a stated period of time. Returns of individual motifs do not take into consideration certain fees and/or commissions, corporate actions, or other activity that can affect the return an investor could expect to incur. The performance results attempt to follow a standardized and consistent methodology for performance reporting. While we believe the performance data is gathered from reliable sources, the information that generates performance results uses historical data that we believe to be accurate but has not been validated and may contain errors in pricing or other conditions. Reference to return of index does not imply its performance is comparable to a motif, but rather serves to provide a reference point. For detailed information on how we calculate returns, please visit www.motifinvesting.com.