Needham analyst Bernie McTernan has reiterated their neutral stance on CHWY stock, giving a Hold rating on December 3.
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Bernie McTernan has given his Hold rating due to a combination of factors influencing Chewy’s financial outlook. The company’s third-quarter results surpassed expectations, yet the anticipated margins for the fourth quarter have led to a more cautious adjusted EBITDA estimate. Despite this, the commentary on operating leverage for 2026 suggests potential margin improvements, which could be a positive sign for future performance.
However, while Chewy is expected to maintain durable growth in the high single digits, the competitive landscape has shifted as e-commerce peers have shown improved growth trajectories over the past six months. This change makes it uncertain whether Chewy can reclaim its premium valuation relative to its peers. The potential for margin expansion is seen as the primary area where estimates might be exceeded, but this is not enough to warrant a more optimistic rating at this time.
In another report released on December 3, UBS also maintained a Hold rating on the stock with a $41.00 price target.
Based on the recent corporate insider activity of 55 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of CHWY in relation to earlier this year.