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BofA analysts said Chewy's pharmacy segment and vet clinics stand to benefit from a rebound in pet adoptions.
CHWY's Autoship hits a record 82.2% of sales, fueling customer loyalty and driving its fiscal 2025 growth outlook.
This commentary first appeared on Forbes Great Speculations , where Schaeffer's Investment Research is a regular contributor.
I reiterate my buy rating on Chewy as fundamentals have improved, supporting confidence in a return to mid-teens revenue growth. Chewy's strong and sustainable active customer growth, driven by effective strategy and improved retention, underpins my bullish outlook. Autoship adoption continues to accelerate, enhancing recurring revenue, customer loyalty, and creating a widening competitive moat for CHWY.
Pet retail stock Chewy (CHWY) hit a June 6, two-year high of $48.62, but since then has taken a more than 20% haircut, thanks in large part to a massive 11% post-earnings drawdown on June 11. After a brief rally from there, the shares have struggled, logging back-to-back weekly losses.
In the closing of the recent trading day, Chewy (CHWY) stood at $40, denoting a -2.49% move from the preceding trading day.
CHWY's adjusted EBITDA margin improves to 6.2% in Q1 as Autoship and ads lifted results, signaling progress toward 10%.
As Amazon.com Inc AMZN may dominate headlines with its extended Prime Day this year — but some of the most interesting trades are hiding in plain sight: Walmart Inc WMT, Peloton Interactive Inc PTON and Chewy Inc CHWY.
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CHWY's growth accelerates with stronger Autoship sales, rising customer retention and expanding vet care services.