Chewy (CHWY) AI Stock Analysis

• Market Cap: $11.44B
• Dividend Yield: N/A
• Average Volume (3M): 6.36M
• Price to Earnings (P/E): 56.9
• Beta (1Y): 0.82
• Revenue Growth: 9.80%
• EPS Growth: -46.84%
• Country: US
• Employees: 18,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 0.14
• Shares Outstanding: 238,520,320
• 10 Day Avg. Volume: 6,824,329
• 30 Day Avg. Volume: 6,359,598
• PEG Ratio: 0.05
• Price to Book (P/B): 61.46
• Price to Sales (P/S): 1.35
• P/FCF Ratio: 35.52
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 0.90
• Enterprise Value/Gross Profit: 3.03
• Enterprise Value/Ebitda: 33.36
• 1Y Price Target: $47.13
• Price Target Upside: 71.01% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 17
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 61 Neutral
• Price Target: $29.00 ▲(5.22% Upside)

The score is driven primarily by improving financial performance—especially strong free cash flow and better gross margins—supported by a constructive earnings update and raised profitability outlook. These positives are tempered by weak longer-term technical positioning (below the 100/200-day averages with negative MACD) and a rich valuation (P/E ~69) with no dividend yield.

Positive Factors

Strong Cash Generation

Consistent, sizable operating cash flow and free cash flow provide durable financial flexibility. Over the next 2–6 months this supports reinvestment in growth (health services, tech), opportunistic buybacks or debt reduction, and cushions the business versus cyclical demand swings.

Improving Gross Margins

Sustained gross margin expansion reflects improving unit economics via pricing, category mix, or cost control. Higher gross margins give permanent operating-leverage potential, enabling incremental investments in marketing, health services, or margin durability even if revenue growth moderates.

Recurring Revenue & Customer Loyalty

Growing Autoship and membership adoption creates predictable recurring revenues and higher customer lifetime value. This structural stickiness reduces churn and acquisition cost pressure, supporting stable revenue streams and more efficient scaling of marketing and service investments.

Negative Factors

Thin Net Profitability

Very low net margins leave little room to absorb cost inflation, promotional cycles, or investment needs. Over months this constrains retained earnings accumulation, limits ability to self-fund expansion, and makes reported profits sensitive to one-off costs or modest sales declines.

Modest Equity Cushion / Leverage Sensitivity

A relatively small and volatile equity base elevates leverage metrics and increases sensitivity to balance-sheet shocks. This structural financial fragility can limit borrowing capacity, raise refinancing risk in stress, and amplify earnings volatility despite solid cash generation.

Elevated SG&A and Margin Guidance Risk

High SG&A as a percent of sales and guidance for sequential margin compression signal persistent cost and marketing intensity. Structurally, sustained elevated SG&A or increased promotional/media spending can erode operating leverage and limit durable margin improvement.

Chewy Business Overview & Revenue Model

Company Description

Chewy, Inc., together with its subsidiaries, engages in the pure play e-commerce business in the United States. The company provides pet food and treats, pet supplies and pet medications, and other pet-health products, as well as pet services for dogs, cats, fish, birds, small pets, horses, and reptiles through its www.chewy.com retail Website, as well as its mobile applications. It offers approximately 100,000 products from 3,000 partner brands. The company was founded in 2010 and is headquartered in Dania Beach, Florida.

How the Company Makes Money

Chewy generates revenue primarily through the sale of pet food and supplies via its online platform. The company's key revenue streams include direct product sales, subscription services through autoship, and various promotional partnerships with pet brands and manufacturers. Autoship subscriptions provide a predictable revenue stream, as customers can set up recurring orders for their pet essentials, often at discounted prices. Additionally, Chewy has established partnerships with leading pet product manufacturers, enabling it to offer exclusive products and promotions, which further enhance its sales. The company also invests in customer engagement strategies, such as personalized recommendations and loyalty programs, to increase repeat purchases and drive overall revenue growth.

Chewy Financial Statement Overview

Summary

Financials show an improving quality profile led by strong cash generation (TTM operating cash flow ~$636M; free cash flow ~$487M) and expanding gross margin (~29.6% TTM). Offsetting this, profitability is still thin (TTM net margin ~1.6%) and the balance sheet has a modest/volatile equity base that can amplify leverage metrics (debt-to-equity ~1.11 TTM).

Income Statement

CHWY’s profitability trajectory has improved meaningfully versus earlier years, with TTM (Trailing-Twelve-Months) showing positive operating profit and net income. Gross margin has gradually strengthened over time (roughly mid‑20%s in 2021 to ~29.6% TTM), signaling better unit economics and/or pricing discipline. The key weakness is that bottom-line profitability remains thin (TTM net margin ~1.6%), and growth is inconsistent—annual revenue growth slowed in 2025 versus prior years despite the strong TTM growth figure, suggesting momentum may be uneven.

Balance Sheet

Leverage looks manageable in absolute dollars (TTM debt of ~$523M against ~$3.29B in assets), but equity has been volatile and relatively low, which keeps leverage metrics elevated (debt-to-equity ~1.11 TTM and materially higher in some prior years). Return on equity is very high in recent periods, but this is amplified by a smaller equity base, so it’s less “clean” as a quality signal. Overall, the balance sheet is improved from earlier stress points, but still carries sensitivity due to modest equity cushion.

Cash Flow

Cash generation is a clear positive: TTM (Trailing-Twelve-Months) operating cash flow (~$636M) and free cash flow (~$487M) are strong and have grown versus prior years. Free cash flow conversion is solid but not exceptional (TTM free cash flow is ~76% of net income), implying some working-capital and/or reinvestment needs. While operating cash flow strength supports flexibility, the data also implies cash flow is not dramatically outpacing accounting earnings, which modestly tempers the score.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	12.58B	11.86B	11.15B	10.12B	8.97B	7.15B
Gross Profit	3.72B	3.47B	3.16B	2.83B	2.39B	1.82B
EBITDA	338.25M	271.77M	161.50M	138.56M	-17.72M	-54.80M
Net Income	206.39M	392.74M	39.58M	49.90M	-75.21M	-92.49M
Balance Sheet
Total Assets	3.29B	3.01B	3.19B	2.52B	2.09B	1.74B
Cash, Cash Equivalents and Short-Term Investments	701.50M	596.66M	1.13B	678.59M	603.08M	563.35M
Total Debt	523.00M	502.40M	527.79M	471.82M	410.17M	328.23M
Total Liabilities	2.83B	2.75B	2.68B	2.36B	2.07B	1.74B
Stockholders Equity	469.40M	261.46M	510.24M	160.27M	14.74M	-2.00M
Cash Flow
Free Cash Flow	487.00M	452.49M	342.93M	119.28M	8.55M	2.01M
Operating Cash Flow	635.72M	596.33M	486.21M	349.57M	191.74M	132.75M
Investing Cash Flow	-178.81M	394.57M	-287.36M	-615.48M	-193.27M	-123.69M
Financing Cash Flow	-288.00M	-996.74M	71.60M	-6.73M	41.26M	342.20M

Chewy Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 27.56
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CHWY, the sentiment is Negative. The current price of 27.56 is below the 20-day moving average (MA) of 31.36, below the 50-day MA of 32.52, and below the 200-day MA of 37.25, indicating a bearish trend. The MACD of -1.28 indicates Positive momentum. The RSI at 28.73 is Positive, neither overbought nor oversold. The STOCH value of 10.88 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CHWY.

Chewy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CART	79 Outperform	$9.59B	20.07	15.33%	―	10.16%	18.29%
GPC	69 Neutral	$20.58B	24.61	17.05%	3.33%	3.26%	-25.41%
BBY	62 Neutral	$14.35B	21.65	22.49%	5.46%	-0.95%	-48.28%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
CHWY	61 Neutral	$11.44B	56.91	59.58%	―	9.80%	-46.84%
BBWI	53 Neutral	$4.63B	6.79	―	4.16%	-1.04%	-20.88%
WOOF	51 Neutral	$734.05M	-241.67	-0.19%	―	-3.85%	97.87%

Chewy Corporate Events

Chewy announces upcoming retirement of Chief Technology Officer

On January 13, 2026, Chewy, Inc. announced that its Chief Technology Officer, Satish Mehta, had notified the company of his intention to retire, with his departure effective February 6, 2026. The company said it will begin a search for his successor, signaling an upcoming leadership transition in its technology organization that could influence Chewy’s long-term digital and operational strategy.

The most recent analyst rating on (CHWY) stock is a Buy with a $52.00 price target. To see the full list of analyst forecasts on Chewy stock, see the CHWY Stock Forecast page.