A further deterioration in CVS's (CVSG) share price has left us asking whether the group is fighting on too many fronts in an overly crowded veterinary practice market. Pets at Home's (PETS) recent results suggested similar issues at its vets business, which it is spending close to £50m to restructure.
IC TIP:
Sell
at
649p
In a trading update, CVS blamed higher locum rates as well as rising salaries for general staff for a further contraction in cash profit margins. Vacancy rates might be improving as a result of more generous wages, but the added cost means a like-for-like sales growth rate of 3.8 per cent isn't making it to the bottom line.
