Chewy Inc. (CHWY) has been recovering as the U.S. pet industry shows signs of stabilization after two years of weakness. The stock has gained around 11% over the past six months and 19% year-to-date as the sector begins to stabilize. Against this backdrop, Evercore ISI’s Top analyst, Mark Mahaney, reiterated an Outperform rating on Chewy and kept a $52 price target, calling the long-term growth story “well intact.”
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Mahaney ranks #335 out of 10,000 analysts tracked on TipRanks. He has a 59% success rate and an average return per rating of 14.10%.
Why Evercore Stays Bullish on CHWY Stock
The 5-star analyst pointed out that industry checks, consumer surveys, and company results all show the U.S. pet industry is stabilizing. He sees both cyclical recovery and ongoing online adoption as supportive of Chewy’s growth outlook.
One of Chewy’s key strengths, he said, is its Autoship model, with 80% of sales tied to recurring subscriptions. This gives the company strong economic resilience, even during periods of softer consumer spending. The analyst also pointed to Chewy’s strong customer satisfaction scores, which he believes will help the company add customers more consistently over time.
Looking ahead, Evercore sees more room for gross margin expansion, led by “Pet Health & Private Label products,” and especially advertising revenue. The analyst noted that ad sales have become a big profit driver for other internet platforms like Amazon (AMZN), Uber (UBER), and eBay (EBAY), and expects Chewy to follow the same path.
On the profitability front, the analyst expects EBITDA margins to rise as marketing spend eases from FY26. The analyst also sees improving free cash flow as a key support for valuation and potential shareholder returns.
Is CHWY Stock a Good Buy?
Overall, Wall Street has a Strong Buy consensus rating on Chewy stock based on 17 Buy and six Hold recommendations. The average CHWY stock price target of $47.20 implies about 19% upside potential from current levels.
