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Chewy Inc CHWY

Morningstar Rating
$18.72 +0.38 (2.07%)
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Company Report

Pet Industry Growth Slows, but Chewy's Loyal Customer Base and Category Expansion Look Salient

The pet care industry is quite attractive, with brand loyalty, sticky purchase habits, pet humanization, and minimal cyclicality representing just a handful of alluring structural features in an $137 billion U.S. market, as noted by the American Pet Products Association. While a slew of players jockey for manufacturing and retail market share, Chewy's service-intensive subscription-driven platform looks poised to capture a disproportionate share of online sales, with the firm building a strong brand around customer service and perceived quality.

Price vs Fair Value

CHWY is trading at a 56% discount.
Price
$18.34
Fair Value
$62.00
Uncertainty
Very High
1-Star Price
$95.10
5-Star Price
$13.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

E-commerce penetration should continue to increase in the pet care category, favoring digital native players like Chewy.

Bears

Chewy may struggle to maintain growth in prescription and over-the-counter drug markets, should veterinarians prove reluctant to fill scripts through its marketplace.

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News

Trading Information

Previous Close Price
$18.34
Day Range
$18.1618.84
52-Week Range
$16.5349.65
Bid/Ask
$18.75 / $18.78
Market Cap
$8.07 Bil
Volume/Avg
8.0 Mil / 7.0 Mil

Key Statistics

Price/Earnings (Normalized)
35.23
Price/Sales
0.73
Dividend Yield
Dividend Yield (Forward)
Total Yield

Company Profile

Chewy is the largest e-commerce pet care retailer in the U.S., generating $10.1 billion in 2022 sales across pet food, treats, hard goods, and pharmacy categories. The firm was founded in 2011, acquired by PetSmart in 2017, and tapped public markets as a standalone company in 2019 after spending a couple of years developing under the aegis of the pet superstore chain. The firm generates sales from pet food, treats, over-the-counter medications, medical prescription fulfillment, and hard goods, like crates, leashes, and bowls.
Sector
Consumer Cyclical
Industry
Internet Retail
Stock Style Box
Mid Growth
Total Number of Employees
19,400

Competitors

Valuation

Metric
CHWY
EBAY
ETSY
Price/Earnings (Normalized)
35.239.7530.01
Price/Book Value
21.613.65
Price/Sales
0.732.213.74
Price/Cash Flow
19.868.4813.80
Price/Earnings
CHWY
EBAY
ETSY

Financial Strength

Metric
CHWY
EBAY
ETSY
Quick Ratio
0.532.052.22
Current Ratio
0.932.162.45
Interest Coverage
20.50
Quick Ratio
CHWY
EBAY
ETSY

Profitability

Metric
CHWY
EBAY
ETSY
Return on Assets (Normalized)
9.18%11.28%25.20%
Return on Equity (Normalized)
104.65%42.94%
Return on Invested Capital (Normalized)
30.40%17.12%34.64%
Return on Assets
CHWY
EBAY
ETSY

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