3 Reasons Why Chewy Stock Is Out of Favor With the Market
- Inflation is circulating throughout the economy. In its second-quarter conference call, management highlighted an imbalance in the supply and demand for labor.
- Economic reopening could slow sales growth. Chewy experienced a nice sales boost at the pandemic's onset. ...
- Supply-chain bottlenecks. ...
Should you buy chewy stock ahead of Q2 earnings?
Nov 05, 2021 · The pet supplies retailer has done well during the pandemic, but a variety of factors have weighed on it this year. Chewy ( CHWY -0.92% ) has been a big winner during the pandemic, but the stock is...
Should you buy chewy stock right now?
Dec 10, 2021 · The answer is likely found in the broader sales trend. When the pandemic hit and people were left hiding in their homes, demand for Chewy's services spiked because people were socially distancing...
Should you buy CHWY stock?
Oct 16, 2021 · 3 Reasons Why Chewy Stock Is Out of Favor With the Market By Parkev Tatevosian - Oct 16, 2021 at 11:38AM Key Points Rising costs …
Is chewy stock overvalued?
Apr 06, 2022 · Chewed Up And Spit Out: Why Chewy Shares Are Falling After Hours - Benzinga - Benzinga benzinga.com - March 29 at 4:42 PM Chewy tumbles after elevated costs contribute to earnings miss - Seeking Alpha
Why are chewy shares down?
Chewy shares were trading sharply lower in late trading Tuesday after the online pet products retailer reported financial results and guidance that fell shy of Wall Street estimates. Chewy said that pandemic-related supply chain constraints continued to pressure results.Mar 29, 2022
Is chewy a good stock to buy?
Chewy currently trades at 2.15 trailing twelve months price to sales, and at 2.07 forward price to sales. At first glance Chewy may seem like just a COVID-19 stock. With net sale per active customer of $419, up over $56 year over year, I say it is nearly time to begin buying a few shares.Feb 24, 2022
Is chewy in financial trouble?
The big drawback for Chewy But while Chewy's seeing sales growth and has a strong position in its niche market, the online retailer still isn't profitable on a bottom-line basis. Chewy's $32.2 million net loss in the third quarter isn't much of an improvement from the $32.8 million net loss in Q3 2020.Dec 31, 2021
What happened to Chewy?
What happened. Shares of online pet retailer Chewy ( CHWY 11.95% ) fell out of the gate on Dec. 10, dropping a quick 10% in early trading. The loss wasn't a surprise, however, as investors digested the company's after-the-close third-quarter 2021 earnings update from Dec.Dec 10, 2021
Is Amazon going to buy Chewy?
Amazon does not own the Chewy Brand, but rather Chewy is owned by PetSmart, which acquired the company in May 2017. However, Chewy is one of the main competitions facing Amazon for the pet products market, Additionally, while Amazon doesn't own Chewy, the company owns the Wag pet supply brand.
Is Chewy A Buy Sell or Hold?
Chewy has received a consensus rating of Buy. The company's average rating score is 2.55, and is based on 13 buy ratings, 8 hold ratings, and 1 sell rating.
Is Chewy profitable?
Still, those investments have shown top-line returns: Chewy enjoys a dominant market share and continues to grow fast, landing a spot on the Fortune 500 last year as revenue rose 47% to pass the $7 billion mark.Oct 25, 2021
Why did Chewy prices go up?
Like Petco, Chewy is also facing rising input costs due to supply-chain challenges and higher marketing prices.Dec 1, 2021
Key Points
Chewy's growth is slowing after ramping up during the pandemic, but that's not abnormal for a maturing company.
NYSE: CHWY
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What happened
Shares of online pet retailer Chewy ( CHWY -0.22% ) fell out of the gate on Dec. 10, dropping a quick 10% in early trading. The loss wasn't a surprise, however, as investors digested the company's after-the-close third-quarter 2021 earnings update from Dec. 9.
So what
The third quarter's results showed a number of very big positives. For example, sales of just over $2.2 billion increased 24.1% compared to the third quarter of 2020. Of that total, sales to customers using "autoship" increased 26.7% to 70.6% of overall sales.
NYSE: CHWY
Investors often extend trends too far into the future, expecting outsize performance to continue, it sometimes seems, indefinitely. That usually doesn't happen, and growth at growth companies eventually slows down as they gain scale.
Now what
In fairness to the bears out there, Chewy's story isn't quite as good as it was in the early days of the pandemic. However, that doesn't mean that the long-term outlook has turned negative. At this point it just seems this fast-growing pet retailer is maturing and, as is normal, growth is starting to slow down.
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The online pet retailer's stock has fallen by almost half since its early 2021 highs
A Fool since 2019, and a graduate of Cal State LA with a B.S. in Finance and M.A. in Economics. Parkev is an adjunct professor of Finance and enjoys reading about financial and economic history. You'll often find him writing about stocks in the consumer goods and technology sectors.
Inflation is circulating throughout the economy
In its second-quarter conference call, management highlighted an imbalance in the supply and demand for labor. As a result, the costs to get people to work for Chewy are rising. The company is making investments (increasing wages and bonuses) to generate applications and onboard enough people to fulfill existing demand for its products.
Economic reopening could slow sales growth
Chewy experienced a nice sales boost at the pandemic's onset. As folks were trying to avoid shopping in brick-and-mortar stores to prevent the risk of contracting the novel coronavirus, they spent more money online. In fiscal 2020, Chewy's revenue increased 47% from a year earlier.
Supply-chain bottlenecks
It seems like supply-chain bottlenecks abound in all parts of the current economy. Customer demand for products is higher than before the pandemic. Meanwhile, fewer people are willing to work at the prevailing wages with a deadly virus still circulating. That's led to shortages of everything from materials to truck drivers and port workers.
