Petco Health and Wellness Company Inc. (NASDAQ:WOOF) is one of the best stocks under $3 to invest in. On February 2, Petco Health and Wellness Company Inc. (NASDAQ:WOOF) announced that it had completed its long-term debt refinancing. As part of its strategy to become more financially flexible and reduce leverage, Petco Health and Wellness Company Inc. (NASDAQ:WOOF) undertook measures to refinance $1.5 billion of its current term loan, as it seeks to transition its business model while facing challenges in t ...

About Petco We're proud to be "where the pets go" to find everything they need to live their best lives for more than 60 years — from their favorite meals and toys, to trusted supplies and expert support from people who get it, because we live it. We believe in the universal truths of pet parenthood — the boundless boops, missing slippers, late night zoomies and everything in between. And we're here for it. Every tail wag, every vet visit, every step of the way. We nurture the pet-human bond in the aisles o ...

SAN DIEGO, Jan. 22, 2026 /PRNewswire/ -- Petco (Nasdaq: WOOF) today announced the pricing of its previously announced senior secured notes offering and has agreed to issue and sell $600,000,000 in aggregate principal amount of new senior secured notes due on February 1, 2031, which will bear interest at a rate of 8.250% per annum (the "notes"). Completion of the notes offering is expected to occur on February 2, 2026 and is subject to, among other things, customary closing conditions. Petco intends to use t ...

Core Viewpoint - Petco is offering $650 million in new senior secured notes to refinance existing debt and for general corporate purposes [1][2]. Group 1: Notes Offering - The offering consists of $650 million in aggregate principal amount of new senior secured notes, subject to pricing and customary closing conditions [1]. - The notes will be guaranteed by Petco's subsidiaries and secured by first-lien and second-lien priority interests in fixed and current assets [3]. - The notes will not be registered under the Securities Act of 1933 and will be offered only to qualified institutional buyers or outside the U.S. [4]. Group 2: Use of Proceeds - The net proceeds from the notes will be used to repay Petco's existing term loan facility, cover related fees and expenses, and for general corporate purposes [2]. Group 3: Security and Priority - The notes will be effectively senior to existing and future unsecured indebtedness and will be equal to senior indebtedness secured on the same priority basis [3]. - The notes will be subordinated to any existing and future secured indebtedness that is not collateral for the notes [3].

Core Viewpoint - Petco (WOOF) is currently focusing on efficiency, which has led to a short-term decline in revenue, indicating a potential underestimation of the company's long-term value [1]. Group 1: Company Performance - Petco's revenue has experienced a decline, which is part of its strategy to enhance operational efficiency [1]. Group 2: Analyst Background - The author has a background in business writing, previously contributing to the Motley Fool Blogging Network and focusing on sectors such as restaurants, retailers, and food manufacturers [1].

Core Insights - Petco Health & Wellness Company Inc. is viewed as a potential investment opportunity despite recent price target adjustments by major financial institutions [1][2] Financial Performance - In Q3 2025, Petco reported a net sales decline of 3.1% to $1.46 billion and a comparable sales decrease of 2.2%, while adjusted EBITDA increased by 21% to $99 million, with a margin expansion of approximately 1.4% to 6.7% [3] - The company achieved a gross margin expansion of 0.75% to 38.9% and reduced SG&A expenses by $32 million, resulting in 0.97% expense leverage [3] Strategic Focus - Petco is shifting its strategy away from unprofitable sales towards high-margin services, with the Services and Other category growing to $255 million [4] - The veterinary business is a key area of growth, with the company exceeding hiring goals and achieving record-high doctor retention [4] Future Outlook - Petco has raised its full-year 2025 Adjusted EBITDA outlook to between $395 million and $397 million, while tightening its net sales forecast to a decline of 2.5% to 2.8% [5] - The company plans to slow the pace of store closures, ending the quarter with 1,389 US stores, as it targets a return to growth in 2026 [4]

Core Insights - Petco reported a data breach that made customers' personal information accessible online due to a setting in one of its software applications [1] - The company filed breach reports in California, Massachusetts, and Texas, indicating a widespread issue [2] Group 1: Breach Details - The breach was identified during a routine security review, and Petco took immediate steps to correct the issue [3] - In California, the breach notification indicated that the law requires notification if more than 500 residents are affected, although the specific number of affected consumers was not disclosed [2] - In Massachusetts, the breach affected seven residents, with compromised information including driver's licenses and credit or debit card numbers, but not Social Security Numbers or financial account information [3] Group 2: Impact in Texas - In Texas, 329 residents were affected, with the breach involving Social Security Numbers, driver's license numbers, financial information, and dates of birth [4] - Petco provided notice to consumers in Texas regarding the breach [4] Group 3: Response and Security Measures - Following the breach, Petco took part of its Vetco Clinics website offline after it was reported that customer records could be accessed online [5] - A spokesperson for Petco stated that the company has implemented and will continue to implement additional security measures to strengthen its systems [6]

Core Insights - The previous investment stance on Petco Health and Wellness (WOOF) was a sell rating due to weakening business fundamentals, while the market anticipated a recovery [1] - The current investment strategy focuses on long-term investments with short-term shorts to identify alpha opportunities, emphasizing a bottom-up analysis of individual companies [1] - The investment duration is medium to long-term, targeting companies with strong fundamentals, sustainable competitive advantages, and growth potential [1] Company Analysis - Petco Health and Wellness has shown signs of weakening fundamentals, which led to a sell rating in the past [1] - The market's expectation of recovery may not align with the actual performance of the company [1] Investment Strategy - The investment approach is centered on identifying solid fundamentals and growth potential in companies [1] - Incorporating short-term shorts into the investment strategy aims to uncover additional alpha opportunities [1]

Core Points - Petco recently experienced a cybersecurity incident that compromised personal information of an unspecified number of individuals [1][2] - Lynch Carpenter, LLP is investigating claims against Petco related to this data breach, indicating potential legal repercussions for the company [1][3] Data Breach Details - An unauthorized individual accessed Petco's network and may have obtained records containing personally identifiable information (PII), including names, Social Security numbers, driver's license numbers, dates of birth, and financial account information such as account numbers and credit or debit card numbers [2][4] - Individuals whose information was affected may be entitled to compensation, highlighting the potential financial implications for Petco [2] Legal Context - Lynch Carpenter is a national class action law firm with a strong track record in data privacy matters, representing millions of clients over more than a decade [3] - The firm has offices in Pennsylvania, California, and Illinois, indicating a broad geographic reach for potential claims against Petco [3]

Core Insights - Petco confirmed a data breach involving customers' personal information, including names, Social Security numbers, driver's license numbers, financial information, and dates of birth [1][3] Group 1: Data Breach Details - The data breach affected customers' personal information, including sensitive data such as Social Security numbers and financial information [1] - Petco filed legally required notices in California, Massachusetts, and Montana, indicating that at least one resident in Massachusetts and three in Montana were affected, while the number in California remains undisclosed [2] - The company served over 24 million customers in 2022, suggesting a potentially large number of affected individuals [3] Group 2: Company Response - Petco stated that the breach was due to a setting in one of its software applications that allowed certain files to be accessible online, which has since been corrected [3] - The company has implemented additional unspecified security measures following the incident [3] - Petco is offering free credit and identity theft monitoring services to the victims of the breach [6]