Chewy price target raised to $53 from $51 at CFRA on strong growth

CFRA raised its price target on Chewy Inc . (NYSE:CHWY) to $53 from $51 on Wednesday, while maintaining its Strong Buy rating following the pet retailer’s first-quarter results. The stock has demonstrated remarkable momentum, with InvestingPro data showing a 78.4% return over the past year and a 25.3% gain in the last six months.

The online pet products company delivered solid performance across all categories including consumables, hardgoods, and healthcare, according to CFRA. The firm noted Chewy achieved accelerating active customer growth of 3.8% year-over-year and expanded its EBITDA margin by 120 basis points to 6.2% on a normalized basis. InvestingPro data reveals the company’s strong financial health with a "GOOD" overall score and revenue growth of 6.4% in the last twelve months.

CFRA slightly reduced its fiscal 2026 earnings per share estimate to $1.21 from $1.24 while maintaining its fiscal 2027 projection at $1.50. Despite the stock trading lower after the earnings release, the research firm believes Chewy is tracking toward the high end of its guidance range and could raise its full-year outlook in coming quarters. According to InvestingPro, the company currently trades at a P/E ratio of 42.7x and an EV/EBITDA multiple of 99.9x, suggesting premium valuations. Subscribers can access 15 additional ProTips and comprehensive financial metrics for deeper analysis.

The price target increase reflects CFRA’s blended valuation approach, applying a multiple of 20 times fiscal 2027 EBITDA and 2.1 times fiscal 2027 enterprise value to sales ratio. The firm highlighted Chewy’s execution across key strategic initiatives including sponsored ads, automation, Chewy+, and veterinary care.

Chewy’s debt-free balance sheet and strong free cash flow generation provide additional room for share repurchases, according to CFRA’s analysis.

In other recent news, Chewy Inc. reported impressive financial results for the first quarter of 2025, exceeding analyst expectations. The company posted an adjusted earnings per share (EPS) of $0.35, surpassing the anticipated $0.32, while revenue reached $3.12 billion, outpacing the projected $3.08 billion. Despite these positive figures, Chewy’s stock experienced a decline, attributed to broader economic concerns rather than company performance. Chewy’s strategic initiatives, including the expansion of its Chewy Plus membership and veterinary clinics, continue to bolster its market position. The company recorded a notable 8.3% year-over-year increase in net sales, with its Autoship program contributing significantly to this growth. Chewy’s guidance for the full year 2025 projects net sales between $12.3 billion and $12.45 billion, indicating a 6-7% growth. The company also plans to maintain its adjusted EBITDA margin outlook of 5.4% to 5.7%. Meanwhile, Chewy’s CFO, David Reeder, announced his departure to pursue a CEO role in the semiconductor industry, with a transition plan in place to ensure continuity.

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