Market Overview

A Look At PetMed Express Through Benzinga's Securities Lending Volatility Index

A Look At PetMed Express Through Benzinga's Securities Lending Volatility Index

Benzinga’s Securities Lending Volatility Index (SLVX) Powered by Tidal Markets, is an indicator that forecasts stock market activity for broader indices and individual securities.

As an example of the SLVX's utility as a stock market indicator, take a look at how changes in the SLVX anticipated a -27.53 percent decline in PetMed Express over 32 trading days between April and May 2019.

PetMed Express, Inc. (NASDAQ: PETS) and its subsidiaries operate as a pet pharmacy in the United States. The company markets prescription and non-prescription pet medications, and other health products for dogs and cats directly to the consumer.

During the end of March and into the early weeks of April, PETS experienced a strong rally in share price, gaining 15.36 percent over the span of fourteen trading days, peaking on April 10th close to its year-to-date high at $23.65.

As the value of PETS grew during the early weeks of April, SLVX values remained muted, suggesting that the growth in share price was justified by the overall sentiment of investors.

But as shares of PETS peaked, the stock began to descend before briefly bouncing back at the end of the month. Just when PetMed Express seemed to be recovering in the final weeks of April, the SLVX dramatically rose in value indicating that the stock's descent was far from over.

On the first day of our analysis, 4/16/2019, the SLVX reflected a volatility rate of 5.647 – well below their 1Q19 average SLVX volatility of 17.17. But as PETS began to fall in value from its April month-high, the SLVX jumped over 300% to 20.006 on April 24th and continued to rise with volatility values as high as 111.319 on May 17th.

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Figure 1

Figure 2

Between April 16th and May 31st, 2019, PetMeds Express lost -27.53 percent, or $4.81 per share, over a 32-day stretch. Meanwhile, the SLVX saw the volatility of PETS rally over levels over 100, before falling in volatility as the share price of PETS continued to decline.

Investors might do well to continue watching SLVX values of PETS into June, as we’ve seen volatility values taper off into the beginning of the month. If the volatility of PETS continues to remain at muted levels, look for a potential buy-back opportunity.

Image sourced from Pixabay

Posted-In: SLVX Tidal MarketsEarnings News Markets General


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