By: Dylan Sikes - AllPennyStocks.com News

Friday, February 28, 2014

In the small cap world, traders are often scouring information and companies looking for the next big thing. That could mean a biotech with a new cancer drug or a technology company postulating that their product will revolutionize an industry. There’s nothing wrong with that type of speculative investing, as it can reap huge rewards, but there are also some slow and steady growth stories in the small cap space that are grinding out profits in some lucrative retail industries. Take for instance OurPet’s Company (OTCQB:OPCO), a Fairport Harbor, Ohio-based proprietary pet supply company. The company designs, produces and markets a wide array of pet products and consumables domestically and internationally. The company has been effectively gaining traction since the start of 2013 when shares were trading as low as 35 cents. 14 months later, shares have climbed to trade in excess of $1.00, closing Thursday at $1.25.

A relatively quiet company just going about its business, OurPet’s has been lifted by a variety of drivers, including settling a patent infringement lawsuit with defendants Go Fetch LLC and Wazir Chand Handicrafts last month. Some may not think of the technology that goes into pet products, but OurPet’s has more than 225 patents issued or pending and is not afraid to defend its IP against poachers.

The company has also launched some new brands recently, including a line of products called OurPets® earlier this month. According to OurPet’s, the new toys and accessories are “designed to awaken a pets' natural instincts.” The new offerings also feature dog and cat toys, feeding and storage products and products for feline and canine waste management. The company also launched Pet Zone®, a line of products exclusively available through the food, drug and mass-market channel.

The business model is bearing fruit for OurPet’s and its shareholders with the company operating profitably for the last four quarters. That string was run to five straight quarters with the release of the results from the fourth quarter of 2013 after Thursday’s closing bell.

OurPet’s logged fourth quarter revenue of $6.03 million, an increase of 1.3 percent from $5.95 million in the fourth quarter, which previously represented a record for the company. The year-prior quarter also included a $250,000 one-time promotional club order, which did not reoccur in the latest quarter.

Gross profit grew by 7 percent to $1.97 million in Q4 2013. Gross profit margin also increased, rising to 32.6 percent from 30 percent in the fourth quarter of 2012.

Net income swelled to $375,355, or 2 cents per share, an increase of 61.3 percent from $232,655 (1 cent per share) a year earlier.

"We are pleased with our record results for the 2013 fourth quarter, which confirm the progress we are achieving related to our growth strategy including benefits from improved operating leverage. These results also enabled us to further strengthen our balance sheet by 2013 year-end, which included an 18% decline in total debt outstanding and a 24% increase in total stockholders' equity compared to the same date in 2012," said Dr. Steven Tsengas, chairman and chief executive at OurPet’s, in a prepared statement.

For all of 2013, net revenue was up about 7 percent to $21.55 million, versus $20.16 million in 2012, led by better sales in the feeding and storage and toys and accessories categories. Net income in 2013 was a record $1.07 million, or 6 cents per share, compared to only $192,740, or 1 cent per share, in 2012.

Shares eked down by less than 1 percent in Thursday trading ahead of the earnings report. So far in 2014, shares of OPCO are up by about 37 percent.

Copyright © 2014 AllPennyStocks.com. All rights reserved. Republication or redistribution of AllPennyStocks.com's content is expressly prohibited without the prior written consent of AllPennyStocks.com. AllPennyStocks.com shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.