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Tag: CHWY Stock

  • Chewy Inc. Surges in Premarket Amidst Meme Stock Rally

    Chewy Inc. Surges in Premarket Amidst Meme Stock Rally

    Chewy, Inc. (NYSE: CHWY) experienced a dramatic turnaround in premarket trading on Monday, following a turbulent week. After a 6.3% decline on Friday, the stock soared by nearly 23% early Monday morning amidst a resurgence of interest in meme stocks. This surge came after it was revealed that Keith Gill, popularly known as RoaringKitty, holds a substantial stake in the company worth approximately $245 million.

    Details of RoaringKitty’s Chewy Stake

    Keith Gill disclosed a 6.6% passive stake in Chewy through a filing with the US Securities and Exchange Commission, indicating ownership of approximately 9 million Class A shares. This disclosure triggered a significant market response, propelling Chewy’s shares up to 29% in premarket trading.

    Gill, renowned for his influential role in rallying retail traders around GameStop Corp. last year, has once again stirred market excitement with his involvement in CHWY. Known for his cryptic social media posts, Gill recently posted an image of a dog, igniting speculation and chatter among investors about its potential significance.

    Background

    Chewy, founded as a pure-play pet e-tailer in the United States, supplies a wide range of pet products and services, catering to various animals from dogs to reptiles. The company’s surge in premarket trading reflects renewed investor optimism fueled by Gill’s substantial investment and his track record in influencing meme stock movements.

    Investors and analysts are closely monitoring the company’s developments amidst this surge, anticipating further market reactions and potential insights into Gill’s strategic interests. As trading opens, all eyes are on CHWY to see how this momentum will unfold throughout the trading day.

    Conclusion

    In summary, Chewy Inc.’s stock price has undergone a remarkable shift, driven by Keith Gill’s significant stake and the resurgence of meme stock enthusiasm. As the trading day progresses, market participants await further developments and insights into the implications of Gill’s involvement in this popular online pet retailer.

  • Chwey Inc. (CHWY) Breaks its Earnings Miss Streak with Upbeat Quarterly Results & Guidance

    During the pandemic’s online shopping boom, Chwey Inc. (CHWY) garnered much attention being an online pet retailer. Confined to their homes, customers found it easy to tend to their pet’s needs without leaving their safe zone as Covid-19 wreaked havoc. As the pandemic hype started to fade, so did the hyped growth of the company. Down over 60% year to date and nearly 70% in the past 12 months, the pure-play pet e-tailer suffered immensely this year. Joining in on the broader downfall of equities this year, CHWY’s wider losses came from continued worse-than-expected earnings lately.

    Investors and analysts were once again expecting not-so-good results for the first quarter of 2022 as the year has added even more challenges to the company’s woes. But despite the numerous challenges and headwinds, the company posted upbeat earnings and guided above the expectations. This resulted in a huge rally in the stock after the earnings were released on June 1, after the market close. Thus, CHWY surged by a nice 16.01% in the pre-market to trade at a price of $27.25 per share. An active volume of 6.02 million shares was responsible for the huge uptick. Prior to the earnings, the stock had subtracted 5.28% in regular trading as investors anticipated the earnings to fall below the expected, once again.

    CHWY’s Q1 Earnings Surprise

    Despite negative expectations and numerous challenges, the online pet supply company’s earnings were better than expected. The company came out with a profit of 4 cents a share against an expected 11 cents loss per share for the quarter. This represents a huge earnings surprise of nearly 130% for the quarter. The net income was $18.5 million, including share-based compensation expenses.

    Moreover, CHWY generated net sales of $2.43 billion in Q1 2022, which rose by 13.7% YOY. Analysts were expecting net sales of $2.41 billion, which was narrowly topped by the company.

    However, the adjusted EBITDA declined by 21.8% YOY to $60.5 million, with a margin of 2.5%. Gross margin also fell down to 27.5% due to a loss of 10 basis points.

    2022 Outlook

    While the earnings beat was a cause of rally in itself, it was the better-than-expected guidance that really overjoyed the investors. As per the shareholder letter, the company expects:

    Source: Q1 Shareholder Letter

    The Q2 and fiscal 2022 guidance of the company surpassed the analysts’ expectations at the top end. Analysts had their sales forecast pegged at $2.44 billion for Q2 and $10.26 billion for the full year.

    Challenges & Headwinds

    This year has been extremely harsh on the market so far due to multiple blows from all directions. The recovery and reemergence of Covid-19, the Russian invasion of Ukraine, soaring inflation, rising interest rates, and global supply chain hurdles, all have been taking a toll on the stock market. The Nasdaq Composite is trading in the bear market territory and the S&P 500 Index is growing closer to it. While these are enough reasons to warrant the difficult positions CHWY has been in, the company has several added woes as well.

    Recovery from the pandemic has led to a decline in the company’s sales as physical retailers and vets are on the market once again. A larger concern has been the supply chain bottleneck for the company. Supply chain disruptions made it difficult to secure products wanted by consumers, while shortages are rising prices on everything from labor to fuel. Huge shipping costs and labor availability problems have been its Achilles heel, while higher-than-usual out-of-stock inventory levels weighed on its top line.

    According to the company, sold-out products and inventory shortages were the foremost reason for the lower sales. The sales were hurt twice as much as the company had anticipated. Given the challenging macroeconomic and geopolitical situation, it is even expected that CHWY might reduce its expectations as many e-commerce retailers have done recently.

    Bright Future Ahead

    Despite the near-term problems and challenges, the long-term future of the company remains bright. The U.S. pet retail industry was estimated to be $123 billion in 2021. Out of which, the online channel accounted for 37% of pet food sales late year. And it is further anticipated that the online channel will result in 55% of the overall pet food sales in the U.S. by 2025. Even though online shopping has seen a little decline since the pandemic surge, it is still here to stay and expected to keep blooming.

    According to third-party estimates, CHWY had approximately 41% of the market share in the online pet retail segment. Being a dominant player in the market, the company is well-placed to further expand and grow its business while capitalizing on the increased adoption of online shopping ahead. For the longer run, analysts expect the company’s earnings to clock a compound annual growth rate of a humungous 267% over the next five years.

    Even for the current supply chain constrained situation, the company has started taking measures with Chewy Freight Services and import routing launch in Q1 2022. The company launched CFS in the Pheonix market in Q1 and now plans to scale it throughout 2022 and 2023. Both the CFS and import routing will help the company with overcoming the higher freight and transport costs.

    CHWY’s Ratings & Valuation

    The stock was recently upgraded by Zack’s Investment Research from a “strong sell” to a “hold”. Jefferies Financial Group has set it on a buy with a price target of $60 and Barclays an equal weight of $26. The average rating for CHWY at the moment is “Buy” and the average price target for the stock is $70.81.

    Currently, the stock is trading at 1.2 times sales, much lower than the S&P 500’s average of 2.6.

    Conclusion

    The pet supply online retailer, like most equities, has had a hard time this year. A major reason for the downfall of CHWY, however, has been its quarterly financials, which have fallen below the expectations over the past three quarters. Numerous challenges, including macroeconomic instability, supply chain hurdles, and pandemic hype recovery, have played a part in the declining sales of the company so far. But despite the challenges, the company came out a winner in the latest earnings report, which was a beat on both the top and bottom lines. Even more so, the company’s guidance also was impressive given the headwinds and economic conditions.

    But even if the company does not perform well in the short term, the long-term future of the company is very bright. With an average buy rating, strong valuation, and a price target with a huge upside, CHWY is a stock to have in one’s portfolio.

  • Chewy Inc. (CHWY) stock Bearish After Hours on Missed 2021 Earnings

    Chewy Inc. (CHWY) stock Bearish After Hours on Missed 2021 Earnings

    On March 29, Chewy Inc. (CHWY) declared its financial results for Q4 and fiscal 2021 which ended on January 30, 2022. Consequently, the stock plunged down in the after-hours session after the earnings were released.

    Source: Jara Accounting

    The positive anticipation of the earnings made the stock trade in the green during the regular session with a gain of 4.51%. CHWY fluctuated between a high of $52.39 and a low of $48.43 during the session. The volume of shares exchanged during the session remained above the average at 9.68 million shares. The stock closed the session at a value of $51.00 per share. Following the results, the stock entered the red in the after-hours at a volume of 2.23 million shares. Thus, CHWY went down to a value of $43.97 per share after losing 13.78% in the after-hours session on Tuesday.

    The pure-play e-commerce business provider, Chewy Inc. supplies pet food and health products. Currently, the company has a market capitalization of $20.4 billion with its 106.79 million outstanding shares. CHWY has declined by 13.52% year to date while it lost 36.55% last year.

    CHWY’s 2021 Results

    Q4 2021

    In the fourth quarter of 2021, the company generated net sales of $2.39 billion with an increase of 17% YOY.

    Moreover, the net loss in the quarter was $63.6 million which also included a share-based compensation expense of $15.8 million.

    CHWY’s gross margin declined by 170 basis points YOY to 25.4% while the adjusted EBITDA margin declined by 420 basis points to (1.2)%.

    Fiscal 2021

    For fiscal 2021, the company reported net sales of $8.89 billion with a growth of 24% YOY.

    Furthermore, the net loss during the year was $73.8 million with a share-based compensation expense of $85.3 million.

    CHWY’s gross margin in 2021 improved by 120 basis points YOY to 26.7% while the adjusted EBITDA margin went down by 30 basis points to 0.9%.

    CHWY Company News

    On January 31, the company announced the launch of its new brand campaign “Chatty Pets”. The campaign gives insights into the world of pets, giving voice to their feelings as they wait for the arrival of a Chewy delivery. Brought to life through collaboration with 72andSunny creative agency, Chewy Pets express the innermost thoughts of multiple pets while connecting to customers through relatable shared experience.

    Conclusion

    On Tuesday, CHWY’s latest earnings report disappointed investors gravely. The company not only missed earnings estimates but also fell short of revenue expectations. Thus, the slower-than-expected sales growth and missed earnings caused the stock to tumble down after hours.

  • Chewy Inc. (CHWY) stock soared in the pre-market trading session: here’s why

    Chewy Inc. (CHWY) stock soared in the pre-market trading session: here’s why

    Chewy Inc (CHWY) stock recently traded at $80.38 which is a 1.94% upward movement. The CHWY stock previously closed at $78.85. In the pre-market trading session, the CHWY stock soared by 10.48% at the time of writing.

    The positive movement in the CHWY stock comes adjacent to the investors reacting on the announcement of the financial report of the Fourth Quarter 2020.

    The highlights of Chewy’s (CHWY) past business activities

    Chewy Inc. (CHWY) is an online retailer specifically for pet food and other pet-related products.  Chewy is based in Florida and was founded in 2011. The sales of the pet food retailer grew since the year 2014 when the sales grew from $205 million to $423 million.  Chewy had been acquired by PetSmart for $3.35 billion. This was at the time, the largest ever acquisition for an e-commerce business. PetSmart has transferred 20% of its ownership that it had in Chewy to its parent company BC Partners – a private equity firm.

    In the year 2017, CHWY stock was doing highly well, with the total revenue of Chewy being around $2 billion and had a market reach of about 51% for online pet food sales in the US. Furthermore, Chewy (CHWY) expanded its portfolio by creating Chewy Pharmacy, which was an innovative pet-specific online pharmacy. There was a team of in-house veterinarians that reviewed and processed the pet-medical orders. In 2019, CHWY sock completed its initial public offering which was very successful, and had earned it an estimate of 1$ billion.

    Reviewing CHWY stock’s fourth-quarter financial report

    Chewy’s financial report on the Q4-Earnings surprised the investors as it announced a 51% sales gain and has topped the $2 billion quarterly revenue mark. The sales for Q4 were reported at $2.04 billion while the analyst expectations were around $1.96-$1.97 billion. CHWY stock had a net income of about $21 million.

    The positivity behind the fourth quarter reported is numerated to a number of reasons. The pandemic was the driver for its online sales, revenue, and as well as online customer base. Chewy saw an increase of 42% in its active customer base year-over-year and now totals at 19.2 million. It customized and improved its CR by launching several marketing initiatives like e-gift cards and telehealth platform that allowed a consulting session with one of their in-house vets. This allowed for 5.7 million additions of net active users in Q4.

    Sumit Sing, CEO of Chewy, announced that the net sales increased by 47% from 2019 to $7.15 billion.  CHWY stock has done well this quarter compared to the last-year quarter where it reported a loss of $60.94 million. Chewy has also reported earnings of $0.05 per share.

    Will the future of CHWY stock’s long-term trend stay consistent?

    Physical retail companies or startups that shifted their whole operation base and business model to online retail during the pandemic mainly saw a rise in their sales and consumer demand. This can be attributed the isolation, stay-at-home and work-from-home trends as well as the convenience of online store shopping that have come to stay in this Covid-era. The main concern that should develop here is, will the market behavior retain the same positive response for online-retail platform in the post Covid era? This question also reflects on the business trends for Chewy (CHWY).

  • Is pandemic favoring the Internet Retail Sector?

    New retail data showed that e-commerce continues to be the most popular form of purchase by consumers. Those statistics triggered a rally on Wednesday for shares of e-commerce companies.

    According to a US Census Bureau report, e-commerce purchases were up 29% in November compared to the same period of the previous year. Retail Metrics analyst Ken Perkins said it represented the biggest monthly increase for e-commerce since 2010 and was the seventh consecutive month of growth exceeding 20%. Shopify Inc. has risen as much as 8.4%, while eBay has risen by 5.4%. Etsy Inc. and Amazon.com Inc. both had gains of at least 2%.

    Perkins wrote in a report that e-commerce is still “dominant in the retail landscape.” He stated that the Centers for Disease Control and Prevention’s recommendation to avoid enclosed shopping areas and the record number of deaths related to Covid-19 have “driven consumers to use contactless payments in record amounts.”

    Jumia Technologies AG (NYSE:JMIA) shares were trading up 8.27% at $39.29 at the time of writing on Wednesday. The company on December 3, 2020 declared the completion of its At The Market offering.

    Jumia Technologies AG (NYSE:JMIA) share price went from a low point around $2.15 to briefly over $40.90 in the past 52 weeks, though shares have since pulled back to $39.29. JMIA market cap has remained high, hitting $3.16B at the time of writing, giving it price-to-sales ratio of more than 10.

    If we look at the recent analyst rating JMIA, Stifel downgraded coverage on JMIA shares with a Hold rating and a $16.71 price target, which implies room for -22.58% downside momentum this year.

    Alibaba Group Holding Limited (BABA) last closed at $261.89, in a 52-week range of $169.95 to $319.32. Analysts have a consensus price target of $338.48.

    eBay Inc. (EBAY) stock soar by 3.01% to $53.65. On December 8, 2020, the company announced that it is introducing a low cost way for sellers to securely ship trading cards. The most recent rating by Piper Sandler, on September 25, 2020, is at an Overweight.

    JD.com Inc. (NASDAQ:JD) Shares headed rising, higher as much as 2.86%. The most recent rating by Barclays, on August 24, 2020, is at an Overweight.

    Vipshop Holdings Limited (NYSE:VIPS) fall -1.16% after losing more than -$0.29 on Wednesday.

    Farfetch Limited (FTCH) last closed at $60.91, in a 52-week range of $5.99 to $61.65. Analysts have a consensus price target of $54.56.

    Chewy Inc. (CHWY) stock soar by 3.28% to $94.12. The most recent rating by Piper Sandler, on November 13, 2020, is at an Overweight. The firm on December 9, 2020 released its financial results for the third quarter of fiscal year 2020 ended November 1, 2020.

    Overstock.com Inc. (NASDAQ:OSTK) Shares headed rising, higher as much as 5.09%. The company declared on December 14, 2020, that it was recently recognized in the seventh annual Loyalty360 Awards for its innovation in technology and for its employee engagement with customers and with associates throughout the company. The most recent rating by Wedbush, on September 16, 2020, is at an Outperform.

    Amazon.com Inc. (NASDAQ:AMZN) rose 2.40% after gaining more than $75.84 on Wednesday. The company today reported that it’s here to help make buying – and returning – even more stress-free and convenient as possible this holiday season.

    Etsy Inc. (ETSY) last closed at $182.34, in a 52-week range of $29.95 to $179.93. Analysts have a consensus price target of $163.29.

    Pinduoduo Inc. (PDD) stock soar by 2.42% to $145.47. On December 15, 2020, the firm reported that it was named a pioneer in digital agriculture at a major conference, with its “cloud agriculture” model recognized as one of the top 10 achievements in digital agriculture in the world. The most recent rating by Nomura, on November 16, 2020, is at a Buy.

    CarParts.com Inc. (NASDAQ:PRTS) Shares headed falling, lower as much as -4.44%. The company recently announced that CEO Lev Peker and CFO/COO David Meniane have been named silver medal winners in the Executive of the Year and Operations Executive of the Year for mid-sized companies categories in the Best in Biz Awards. The most recent rating by ROTH Capital, on September 09, 2020, is at a Buy.

    Dada Nexus Limited (NASDAQ:DADA) rose 4.02% after gaining more than $1.49 on Wednesday. DADA recently announced the launch of “Warm Winter Plan” across China to ensure delivery riders’ safety and health during the winter season.

    Mercurity Fintech Holding Inc. (MFH) last closed at $3.05, in a 52-week range of $1.00 to $5.20. The company on November 27, 2020 declared its unaudited financial results for the third quarter ended September 30, 2020.

    Qurate Retail Inc. (QRTEA) stock soar by 1.35% to $10.52. The company on November 20, 2020 declared special cash dividend of $1.50 per common share and announced commencement of share buyback program. The most recent rating by Citigroup, on December 15, 2020, is at a Neutral.

  • Early Morning Vibes: 4 Best Stocks To Buy Today

    Early Morning Vibes: 4 Best Stocks To Buy Today

    On December 15, the American stock indices closed in positive territory. The S&P 500 index rose 1.29% to 3695 points, the Dow Jones rose 1.13%, the NASDAQ rose 1.25%. The main positive driver was the optimistic expectations regarding the new package of fiscal support. Increased risk appetite allowed all 11 sectors to close in the green zone. The tech sector became one of the leaders of growth, adding 1.61%, the locomotive was the shares of Apple.
     

    Corporate Update
     

    According to media reports, Apple (AAPL: + 5%) plans to increase iPhone production by 30% YoY amid strong demand for the new iPhone 12 Pro models.

    Eli Lilly (LLY: + 6%) released strong forecasts for 2021 and announced a deal to buy Prevail Therapeutics (PRVL: + 82%) for $ 1 billion.
     

    China’s Baidu Corporation (BIDU: + 13.8%) is considering entering the electric vehicle market and is in talks with automakers.
     

    Today, world stock exchanges are showing mostly positive dynamics. Two potential drivers of growth are in the spotlight: progress in negotiations between US lawmakers on a new package of economic support and the outcome of the Fed meeting. Congressmen continue to actively discuss the bill on measures to help the economy. At the moment, it is most likely that a package of about $ 750 billion will be accepted. This option excludes the most controversial aspects that have hindered a compromise over the past six months. Lawmakers plan to vote this week, while also approving other spending items, including an extension of government funding.
     

    The Fed is expected to repeat the rhetoric of previous meetings, active actions of the regulator are unlikely, as well as changes in long-term forecasts for the rate. Jerome Powell will re-emphasize the importance of fiscal policy. Most likely, the parameters of the program for purchasing government bonds will not be changed, but this program itself can be extended, which will support optimism in the markets.

    Today Top Movers


    Niu Technologies (NIU) is up 0.79% at $29.41 in premarket trading on Wednesday. In spite of no news on the stock directly, a broader piece of news today has helped several stocks.
     

    Hexo Corp (HEXO) share price increased 2.75% at $1.12 in today’s early morning session following the release of its first quarter fiscal 2021 financial results.
     

    Marathon Patent Group Inc (MARA) is going up 5.80% in premarket session on Wednesday. Despite few business articles or no business news lately, this stock has drastically climbed in value.
     

    Tilray Inc (TLRY) share price gaining 20.97% at $9.52 in premarket trading today following Its merger news with Aphria.

    Top Upgrades & Downgrades

    Credit Suisse turned bullish on Galera Therapeutics Inc. (GRTX), upgrading the stock to “Outperform” and assigning a $15.0 price target, representing potential upside of 18.48%.
     

    Atlantica Sustainable Infrastructure plc (AY) has won the favor of Seaport Global’s equity research team. The firm upgraded the shares from Neutral to Buy and moved their price target to $38.0.
     

    Wells Fargo & Company (WFC) received an upgrade from analysts at Keefe, Bruyette & Woods, who also set their one-year price target on the stock to $36.0. They changed their rating on WFC to Outperform from Market Perform in a recently issued research note.
     

    Earlier Wednesday RBC Capital reduced its rating on Pfizer Inc. (PFE) stock to Sector Perform from Outperform and assigned the price target to $42.0.
     

    KeyBanc analysts reduced their investment ratings, saying in research reports covered by the media that its rating for Aptiv PLC (APTV) has been changed to Sector Weight from Overweight.

    Latest Insider Activity


    Chewy Inc. (CHWY) Director STAR JAMES A announced the sale of shares taking place on Dec 11 at $85.06 for some 30,000 shares. The total came to more than $2.55 million.
     

    CarGurus Inc. (CARG) General Counsel and Secretary Patton Kathleen Bender sold on Dec 14 a total 103,142 shares at $30.00 on average. The insider’s sale generated proceeds of almost $0.17 million.
     

    Elys Game Technology Corp. (ELYS) Vice President of Technology Pasquini Luca declared the purchase of shares taking place on Dec 14 at $3.15 for some 1,000 shares. The transaction amount was around $3150.0.
     

    Retractable Technologies Inc. (RVP) President and CEO SHAW THOMAS J bought on Dec 14 a total 14,076,660 shares at $12.85 on average. The purchase cost the insider an estimated $3,007.

    Earnings To Watch


    Top US earnings releases scheduled for today include Lennar Corporation (NYSE:LEN). It will announce its Nov 2020 financial results. The company is expected to report earnings of $2.37 per share from revenues of $6.65B in the three-month period.
     

    Analysts expect Qutoutiao Inc. (NASDAQ:QTT) to report a net income (adjusted) of -$0.09 per share, when the bank releases its quarterly results shortly. Revenue for the fiscal quarter ended Sep 2020 is predicted to come in at $174.89M.
     

    Herman Miller Inc. (MLHR), due to announce earnings after the market closes today, is expected to report earnings of $0.56 per share from revenues of $585.5M recently concluded three-month period.