Why is Central Garden & Pet Company (CENT) One of the Best Pet Stocks to Buy According to Hedge Funds?

Core Insights - Central Garden & Pet Company (NASDAQ:CENT) is recognized as a strong investment opportunity by hedge funds, particularly due to its recent strategic decisions and financial performance [1][2]. Financial Performance - For fiscal Q1 2026, Central Garden & Pet reported net sales of $617 million, a decrease from $656 million in fiscal Q1 2025 [2]. - The company achieved a GAAP diluted EPS of $0.11 and a non-GAAP diluted EPS of $0.21, down from $0.21 in the previous year [2]. - Gross margin improved by 110 basis points to 30.9%, compared to 29.8% in the prior year, attributed to enhanced productivity [2]. - Non-GAAP gross margin stood at 30.8% [2]. Corporate Actions - On February 17, the Board of Directors authorized an increase in the stock repurchase program, allowing for the purchase of an additional $100 million of common and Class A common stock, indicating management's belief that the shares are currently undervalued [1]. - Kay M. Schwichtenberg was appointed to the Board of Directors, effective March 1, 2026, which may bring new perspectives to the company's governance [2]. Industry Context - Central Garden & Pet operates in the garden and pet industries in the US, with its business divided into two segments: Pet and Garden [3].