Pet supplies retailer Chewy (CHWY) is scheduled to announce its results for the first quarter of 2025 before the market opens on Wednesday, June 11. Ahead of the Q1 print, JPMorgan analyst Doug Anmuth maintained a Buy rating on Chewy stock with a price target of $36 per share. Anmuth, a 5-star analyst, has a success rate of 63%, with an average return per rating of 21.2% over a one-year timeframe.
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Wall Street expects Chewy to report Q1 FY25 EPS (earnings per share) of $0.17, reflecting more than 13% year-over-year growth. Meanwhile, revenue is expected to increase by about 7% to $3.08 billion. Over the past year, Chewy stock is up about 100%.
JP Morgan Is Bullish on Chewy Stock
JP Morgan remained positive on Chewy’s stock, citing strong execution, product improvements, and steady trends in the pet care market. The firm expects the company to continue delivering growth in active customers. For the quarter ended May 4, he anticipates that Chewy will add 104,000 active users and 421,000 for the full year.
In terms of sales, Anmuth expects sales to be up 6% year-over-year for Q1. For FY25, he expects a 3% rise, but says there could be more upside. Meanwhile, he expects a 5.4% adjusted EBITDA margin for FY25, up 59 basis points from last year. He added that sponsored ads, smart pricing, and better scale should continue to help margins.
On top of that, Chewy still has $407 million available for share buybacks, which the analyst sees as a way to return value to investors. He also thinks the company could raise its full-year forecast. Right now, Chewy expects net sales of $12.3 billion to $12.45 billion and adjusted EBITDA margins between 5.4% and 5.7%.
Overall, JPMorgan sees Chewy as a well-run company with solid fundamentals and room for upside as the year progresses.
Is Chewy a Good Stock to Buy?
Overall, Wall Street has a Strong Buy consensus rating on Chewy stock based on 18 Buys and six Hold recommendations. Given the solid year-to-date rally, the average CHWY stock price target of $42.30 implies about 10.93% downside risk for current levels.
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