UPDATE: Stifel Nicolaus Initiates Coverage on Aratana Therapeutics with Buy Rating, $13 PT on Innovative Market Play

In a report published Monday, Stifel Nicolaus analyst Jonathan Block initiated coverage on

with a Buy rating and $13.00 price target. In the report, Stifel Nicolaus noted, “U.S. consumers spent $53bn on their pets in 2012, up 38% from 2006, a CAGR of 5.5%. In the veterinary care segment, spending increased at a 6.7% CAGR over the same period of time. The 'medicalization' of the pet industry is helping to drive increased levels of spend, yet only a modest $1.6bn is spent on pet therapeutics as the industry is still in a nascent stage. With data suggesting the amount of money an owner is willing to spend on their pet before stopping treatment now over $1,700, up 2x from 10 years ago, the market seems ripe for more effective therapeutics specific to companion animals. This is where Aratana's product portfolio and business strategy enters the fray.” Aratana Therapeutics closed on Friday at $10.12.