Now trading at a price of $39.05, Chewy has moved -0.5% so far today.
Over the last year, Chewy logged a 2.9% change, with its stock price reaching a high of $52.88 and a low of $29.1. Over the same period, the stock underperformed the S&P 500 index by -9.0%. As of April 2023, the company's 50-day average price was $34.31. Chewy, Inc., together with its subsidiaries, engages in the pure play e-commerce business in the United States. Based in Plantation, FL, the large-cap Consumer Discretionary company has 19,400 full time employees. Chewy has not offered a dividend during the last year.
EPS Trend Sustained Primarily by Reducing the Number of Shares Outstanding:
| 2020-01-31 | 2021-01-31 | 2022-01-31 | 2023-01-31 | |
|---|---|---|---|---|
| Revenue (MM) | $4,847 | $7,146 | $8,891 | $10,099 |
| Gross Margins | 23.6% | 25.5% | 26.7% | 28.0% |
| Operating Margins | -5.2% | -1.3% | -0.8% | 0.6% |
| Net Margins | -5.21% | -1.29% | -0.83% | 0.49% |
| Net Income (MM) | -$252 | -$92 | -$74 | $49 |
| Net Interest Expense (MM) | 0 | -2 | -2 | 9 |
| Net Interest Expense (MM) | $0 | -$2 | -$2 | $9 |
| Depreciation & Amort. (MM) | -$31 | -$36 | -$55 | -$83 |
| Earnings Per Share | -$0.63 | -$0.23 | -$0.18 | $0.13 |
| EPS Growth | n/a | 63.49% | 21.74% | 172.22% |
| Diluted Shares (MM) | 398 | 407 | 417 | 116 |
| Free Cash Flow (MM) | -$2 | $2 | $9 | $119 |
| Capital Expenditures (MM) | -$49 | -$131 | -$183 | -$230 |
| Net Current Assets (MM) | -$707 | -$516 | -$748 | -$781 |
| Current Ratio | 0.57 | 0.89 | 0.8 | 0.86 |
| Net Debt / EBITDA | -0.52 | 4.29 | 11.24 | 0.98 |
Chewy's financial statements include several red flags such as slimmer gross margins than its peers, consistently negative margins with a stable trend, and EPS growth acheived by reducing the number of outstanding shares. Additionally, the firm has a highly leveraged balance sheet. On the other hand, the company benefits from growing revenues and increasing reinvestment in the business and a pattern of improving cash flows.
Chewy's P/B and P/E Ratios Are Higher Than Average:
Chewy has a trailing twelve month P/E ratio of 263.9, compared to an average of 22.33 for the Consumer Discretionary sector. Based on its EPS guidance of $0.18, the company has a forward P/E ratio of 190.6. The 5.2% compound average growth rate of Chewy's historical and projected earnings per share yields a PEG ratio of 51.21. This suggests that these shares are overvalued. Furthermore, Chewy is likely overvalued compared to the book value of its equity, since its P/B ratio of 59.08 is higher than the sector average of 3.12. The company's shares are currently trading 2708.7% above their Graham number.
Chewy Has an Average Rating of Buy:
The 26 analysts following Chewy have set target prices ranging from $26.0 to $67.75 per share, for an average of $45.26 with a buy rating. As of April 2023, the company is trading -24.2% away from its average target price, indicating that there is an analyst consensus of some upside potential.
Chewy has an unusually large proportion of its shares sold short because 24.4% of the company's shares are sold short. Institutions own 96.1% of the company's shares, and the insider ownership rate stands at 17.52%, suggesting a large amount of insider shareholders. The largest shareholder is Morgan Stanley, whose 15% stake in the company is worth $670,212,510.
