If Ralph Waldo Emerson’s theorem, paraphrased as ‘build a better mousetrap, and the world will beat a path to your door’, is valid, OurPet’s Company (OTCQX: OPCO) is following ‘a broad hard-beaten road’ to success. OurPet’s Company got into the pet care industry precisely to make the aphoristic mousetrap better. It’s doing that and making new mousetraps too. Writing in 1855, Emerson was expressing his belief that ‘common fame’, what we would now call a good reputation, would eventually make itself known, which is true for OurPet’s Company, a company with a reputation for innovation. It is a company that aimed to revolutionize and disrupt the rather staid pet care industry and has already been doing so for over 20 years. The rewards from this creative approach have been showing up in both the top and bottom lines.
Net revenues have increased steadily over the past five years, rising at a compound annual growth rate (CAGR) of 6.86 percent. This is well above the industry CAGR of 4.44 percent. OurPet’s Company’s sales in 2010 were $17.1M. The latest 10-K filing reports sales in 2015 were $23.8M. Gross profit has been improving, as well; and so has the gross profit margin, which has climbed from 23.6 percent in 2011 to 31.7 percent in 2015. Particularly encouraging for shareholders has been the moderate increase in outstanding shares, which went up by a little over 10 percent during the last five years. In addition, net income per share has risen by 600 percent from a paltry $0.01 in 2011 to $0.07 in 2015. Taken together with the increase in income available to shareholders, this shows modest dilution risk.
OurPet’s Company has been serving the pet care market since 1995. It started with just one product: the Big Dog Feeder®. Since then its product line has exploded. The company has approximately 1,000 stock-keeping units (SKUs) available to customers over a diversified range of product solutions. Added to the current product offerings is a broad pipeline of now-developing and soon-to-be-developed products and line extensions based on OurPet’s Company’s 160 patents issued and pending.
OurPet’s Company’s strategy is to focus on high-growth categories in the pet care market, which overall is expected to reach $62.75 billion in 2016. The company is in the feeding and storage systems segment, which is estimated at $100M annually, with novel products such as the Barking Bistro®, the High Rise Diner® and its OurPets® Tilt-A-Bowls. It has a foothold in the $250M a year feline waste and odor control category with its SmartScoop® Intelligent Litter Box, Kitty Potty™ No Touch Litter Box System and the OurPets® Switchgrass Natural Cat Litter with BioChar.
It’s also blazing a trail in the toys and accessories segment, which is estimated at $1.0 billion annually, with the amazing OurPets® Catty Whack® and the Intelligent Pet Care® line of products. The Intelligent Pet Care® line applies Bluetooth and Wi-Fi technologies to keep us in closer touch with our pets by signaling changes in their behavior through digital applications. OurPet’s Company’s mission statement is ‘to exceed pet and pet parent expectations with innovative solutions’. They might have added investor expectations to that declaration.
For more information, visit the company’s website at www.ourpets.com
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