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On Friday, TD Cowen analysts increased the price target for Chewy Inc . (NYSE: NYSE:CHWY) stock to $52 from $44 while maintaining a Buy rating. The analysts anticipate Chewy will report first-quarter 2025 revenue of $3.09 billion, marking a 7.2% year-over-year increase, aligning with both consensus and the high end of its guidance. This growth is driven by an estimated 11% rise in Autoship sales. According to InvestingPro data, Chewy maintains strong financial health with an overall score of GREAT, supported by robust cash flows that sufficiently cover interest payments.
The analysts forecast a gross margin of 29.9% for the first quarter, up from 29.7% in the same period last year, driven by advertising growth. Earnings before interest, taxes, depreciation, and amortization (EBITDA) are expected to reach $186 million, representing a 14.3% year-over-year increase. The analysts noted positive purchaser trends in the first and second quarters to date, prompting them to slightly raise their estimates and increase the price target. For deeper insights into Chewy’s valuation and growth prospects, InvestingPro subscribers can access exclusive analysis and 17 additional ProTips about the company’s financial health and market position.
Chewy shares have risen approximately 42% year-to-date, significantly outperforming the S&P 500’s 1% gain. The stock has also climbed about 40% since the company reported its fourth-quarter earnings on March 26. The analysts highlighted that Chewy’s shares have seen moderate multiple expansion, currently trading at around 21 times enterprise value to EBITDA based on 2026 estimates.
The analysts view this multiple expansion as reasonable, given the projected 21% compound annual growth rate in EBITDA from 2025 to 2030. They also noted Chewy’s relative insulation from potential tariffs and recession headwinds compared to other e-commerce platforms. Chewy is set to report its earnings before the market opens on June 11.
In other recent news, Chewy Inc. is gearing up for its first-quarter earnings report, with BofA Securities projecting revenue of $3.09 billion, slightly above the consensus estimate of $3.08 billion, reflecting an anticipated 7.4% year-over-year growth. Analysts from JPMorgan maintain an Overweight rating on Chewy, with expectations of a 6% increase in net sales for the first quarter and a 3% rise for the full fiscal year 2025. UBS analysts have raised their price target for Chewy stock to $46, while maintaining a Neutral rating, as they await confirmation of the company’s growth momentum in the upcoming earnings report.
Meanwhile, Jefferies has downgraded Chewy’s stock from Buy to Hold, citing valuation concerns, despite an increased price target to $43. BofA Securities also raised its price target to $49, noting strategic investments in advertising that have boosted customer acquisition. In corporate news, Chewy announced that CFO David Reeder will depart to join the semiconductor sector, with the company actively searching for his successor. CEO Sumit Singh expressed appreciation for Reeder’s contributions and reaffirmed the company’s first-quarter guidance. These developments come as Chewy continues to navigate a stable pet market and aims to enhance its customer base through targeted advertising efforts.
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