Why Petmed Express Inc.'s Shares Popped 19% Today

What happened

Shares of Petmed Express Inc. (NASDAQ: PETS), or 1-800-PetMeds as it's more commonly known, jumped as much as 18.8% in trading Monday after the company reported fiscal second-quarter results. The early pop subsided somewhat, and at 2:05 p.m. EDT shares were up 12.7% on the day.

So what

Revenue was up 7% in the quarter to $71.4 million and net income was up 23% to $10.8 million, or $0.52 per share. Analysts were expecting $72.2 million in revenue and earnings of $0.50 per share.

One of the most positive signs for the company was that reorder sales, which measure customers who keep coming back to the company, were up 11% to $61 million.

Now what

Investors clearly aren't concerned about the slight revenue miss, and are focused today on the earnings-per-share beat by PetMeds. What's most impressive is the margin expansion from customers who keep coming back to the company for pet supplies. That's a sustainable long-term business, and that's why investors should be bullish on PetMeds' move today.

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Travis Hoium has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.