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Guggenheim raised its price target on Chewy Inc . (NYSE:CHWY) stock to $45.00 from $42.00 on Thursday, while maintaining its Buy rating following the online pet retailer’s first-quarter 2025 results. According to InvestingPro data, the stock has seen significant momentum with an 81.8% return over the past year, despite recent volatility. With a market capitalization of $16.9 billion, Chewy trades at a P/E ratio of 50.2, reflecting high growth expectations.
The research firm described Chewy’s operating results as "net constructive," highlighting three key points that supported the more optimistic outlook. Customer growth significantly exceeded Guggenheim’s expectations, with Chewy adding approximately 240,000 active customers compared to the anticipated 135,000, resulting from "underlying improvements in gross adds and gross churn." This customer growth has contributed to Chewy’s solid revenue growth of 6.4% in the last twelve months, with total revenue reaching $11.9 billion.
Chewy’s sponsored advertisements and favorable product mix contributed to the positive assessment. The company reported low-double digit growth in hardgoods and low-teens growth in its "other" segment, which includes pharmacy, proprietary brands, and specialty items, positioning the company for continued gross margin expansion throughout 2025. InvestingPro analysis shows the company maintains a healthy gross profit margin of 29.2%, with 15+ additional ProTips available for subscribers seeking deeper insights into Chewy’s financial health and growth prospects.
Fulfillment expenses and general and administrative costs are expected to positively impact Chewy’s EBITDA margin profile for 2025. Guggenheim noted that G&A expense leverage was approximately 60 basis points during the first quarter.
Guggenheim reiterated its Buy rating on Chewy shares, citing the company’s performance as supportive of its expectation for low-to-mid-single digit net customer growth during 2025.
In other recent news, several analysts have raised their price targets for Chewy Inc., reflecting positive developments for the company. JPMorgan increased its price target to $47, citing active customer growth and profitability improvements, while projecting Chewy’s revenue to potentially reach the upper half of its guidance range for fiscal 2025. Morgan Stanley (NYSE:MS) also raised its price target to $50, noting strong active customer growth and projecting EBITDA margins above guidance for 2025 and 2026. Jefferies raised its target to $44, attributing the increase to a strong start in 2025 and positive market share gains, although it maintained a Hold rating due to valuation considerations.
Goldman Sachs increased its price target to $48 following Chewy’s recent earnings report, which exceeded expectations for net sales and active customer additions. The firm highlighted strategic initiatives like the Chewy+ loyalty program and expansion into Vet Care clinics as drivers of momentum. Citi raised its price target to $49, emphasizing Chewy’s market share gains and potential for margin expansion, viewing the recent stock weakness as a buying opportunity. These developments underscore the analysts’ confidence in Chewy’s growth trajectory and strategic initiatives, despite some challenges in profitability metrics.
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