The S&P500 index outperformed the publicly traded stock of three of the top 10 companies in the pet food industry, while one growing company beat the wider market index from May 2023 to May 2024. Investment bank Cascadia Capital follows its own index of publicly traded pet industry stocks, including Nestlé, J.M Smucker, Chewy and FreshPet. Cascadia’s analysts examined the performance of these companies in the summer 2024 edition of Cascadia’s “Pet Industry Overview” report. The S&P 500, or Standard & Poor's 500, is a stock market index that measures the performance of 500 of the largest publicly traded companies in the United States.
Revenue for Cascadia’s publicly traded pet company index grew 5.6% in 2023, compared to 8.3% in the prior-year period. Price increases may have accounted for that higher growth in 2022. Despite the revenue growth slowdown, adjusted earnings for companies in Cascadia’s index increased 19.9% in 2023, versus a decrease of 2% in 2022.
Pet food companies compared to a stock market index
Three companies trailed the S&P500. Although Purina PetCare led growth for parent company Nestle, the stock declined nearly 30% from May 2023 to May 2024, while the S&P index climbed approximately 25%. In Petfood Industry’s Top Pet Food Companies database for 2023, the pet food company with the highest annual revenue shifted from Mars Petcare to Purina PetCare. Purina’s annual revenue was US$21,470 million in 2023.
Similarly, J.M. Smucker’s pet division grew in the past year, but the company’s stock declined by nearly 30%. Smucker’s was the world’s sixth-largest pet food company in 2023, with an annual revenue of US$1,500 million.
“Despite divesting half of its overall pet sales, the segment’s dollar profitability remained consistent with the prior year period due to higher margin product mix of its cat food and dog snack businesses,” Cascadia analysts wrote about Smucker.
General Mill’s pet segment, dominated by Blue Buffalo, generated somewhat less in sales during the past year, compared to two years ago. General Mill’s stock declined by more than 20% during the past year. General Mills annual revenue in 2023 was US$2,500 million, making it the fourth-largest globally.
Of the pet food companies in Cascadia’s index, Freshpet beat the S&P500, increasing nearly 80%. Freshpet's annual revenue in 2023 was US$766.90 million.
