Chewy (CHWY) Stock Forecast & Price Target

Chewy reported fiscal 2024 sales of $11.9 billion, reflecting strong performance across its pet food, treats, hard goods, and pharmacy categories. The company achieved an increase of approximately 150,000 active customers in the last quarter, totaling 20.9 million, which surpassed consensus growth expectations and signaled improvements in customer acquisition quality, as evidenced by a net sales per active customer (NSPAC) of $591, up 5% year-over-year. Additionally, management's raised outlook for full-year revenue projections, combined with expanding EBITDA margins and robust growth in autoship sales, further underscores the positive trajectory of Chewy’s core business.

Chewy, the largest e-commerce petcare retailer in the U.S., is facing significant risks that contribute to a negative outlook on its stock, despite generating impressive sales of $11.9 billion in fiscal 2024. The company may encounter challenges from slowing e-commerce penetration in the pet category, increasing competition, and changing consumer trends which could threaten its premium market position over the next 6-12 months. Additionally, management's cautious forecasting indicates a future of low single-digit industry growth and minimal pricing contributions, reflecting a potentially prolonged period of normalization in the market.