Chewy logged a -0.5% change during today's morning session, and is now trading at a price of $34.48 per share.
Chewy returned gains of 5.3% last year, with its stock price reaching a high of $48.62 and a low of $29.82. Over the same period, the stock underperformed the S&P 500 index by -7.5%. The company's 50-day average price was $36.57. Chewy, Inc., together with its subsidiaries, engages in the e-commerce business in the United States. Based in Plantation, FL, the Large-Cap Consumer Discretionary company has 18,000 full time employees. Chewy has not offered a dividend during the last year.
Strong Revenue Growth but Not Enough Current Assets to Cover Current Liabilities:
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $4,847 | $7,146 | $8,967 | $10,119 | $11,148 | $11,861 |
| Gross Margins | 24.0% | 25.0% | 27.0% | 28.0% | n/a | 28.0% |
| Net Margins | -5% | -1% | -1% | 0% | 0% | 3% |
| Net Income (M) | -$252 | -$92 | -$75 | $50 | $40 | $393 |
| Net Interest Expense (M) | $0 | -$2 | -$2 | $9 | n/a | $35 |
| Depreciation & Amort. (M) | $31 | $36 | $55 | $83 | $110 | $73 |
| Diluted Shares (M) | 409 | 418 | 428 | 431 | 427 | 425 |
| Earnings Per Share | -$0.63 | -$0.23 | -$0.18 | $0.12 | $0.09 | $0.91 |
| EPS Growth | n/a | 63.49% | 21.74% | 166.67% | -25.0% | 911.11% |
| Avg. Price | $28.96 | $50.16 | $80.52 | $38.84 | $23.63 | $34.67 |
| P/E Ratio | -45.97 | -218.09 | -447.33 | 323.67 | 262.56 | 37.28 |
| Free Cash Flow (M) | -$2 | $2 | $9 | $119 | $343 | $452 |
| CAPEX (M) | $49 | $131 | $183 | $230 | $143 | $144 |
| Current Ratio | 0.86 | 0.89 | 0.85 | 0.96 | 0.74 | 0.8 |
Chewy has rapidly growing revenues and increasing reinvestment in the business, generally positive cash flows, and a strong EPS growth trend. However, the firm suffers from slimmer gross margins than its peers and not enough current assets to cover current liabilities because its current ratio is 0.8.
Chewy's Valuation Is in Line With Its Sector Averages:
Chewy has a trailing twelve month P/E ratio of 101.6, compared to an average of 20.93 for the Consumer Discretionary sector. Based on its EPS guidance of $0.6, the company has a forward P/E ratio of 61.0. The 10.0% compound average growth rate of Chewy's historical and projected earnings per share yields a PEG ratio of 10.13. 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 36.64 is higher than the sector average of 2.93. The company's shares are currently trading 711.3% below their Graham number. Ultimately, Chewy's strong cash flows, decent earnings multiple, and healthy debt levels factor towards it being fairly valued, its elevated P/B ratio notwithstanding.
There's an Analyst Consensus of Strong Upside Potential for Chewy:
The 22 analysts following Chewy have set target prices ranging from $34.0 to $52.0 per share, for an average of $45.32 with a buy rating. The company is trading -23.9% away from its average target price, indicating that there is an analyst consensus of strong upside potential.
Chewy has an average amount of shares sold short because 6.9% of the company's shares are sold short. Institutions own 97.9% of the company's shares, and the insider ownership rate stands at 2.63%, suggesting a large amount of insider shareholders. The largest shareholder is Bc Partners Pe LP, whose 84% stake in the company is worth $6,542,870,924.
