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Chewy (CHWY) Stock Slides as Market Rises: Facts to Know Before You Trade

Chewy (CHWY) closed the most recent trading day at $17.42, moving -1.75% from the previous trading session. The stock fell short of the S&P 500, which registered a gain of 0.38% for the day. Meanwhile, the Dow experienced a rise of 1.47%, and the technology-dominated Nasdaq saw a decrease of 0.23%.

Prior to today's trading, shares of the online pet store had lost 7.37% over the past month. This has lagged the Consumer Staples sector's gain of 6.09% and the S&P 500's gain of 10.72% in that time.

The investment community will be paying close attention to the earnings performance of Chewy in its upcoming release. The company is slated to reveal its earnings on December 6, 2023. In that report, analysts expect Chewy to post earnings of $0.09 per share. This would mark year-over-year growth of 800%. Meanwhile, the latest consensus estimate predicts the revenue to be $2.81 billion, indicating a 10.8% increase compared to the same quarter of the previous year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $0.57 per share and revenue of $11.25 billion. These totals would mark changes of +7.55% and +11.38%, respectively, from last year.

Any recent changes to analyst estimates for Chewy should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 33.33% upward. As of now, Chewy holds a Zacks Rank of #3 (Hold).

In terms of valuation, Chewy is currently trading at a Forward P/E ratio of 31.1. For comparison, its industry has an average Forward P/E of 18.48, which means Chewy is trading at a premium to the group.

Meanwhile, CHWY's PEG ratio is currently 1.31. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Consumer Products - Staples industry had an average PEG ratio of 2.22 as trading concluded yesterday.

The Consumer Products - Staples industry is part of the Consumer Staples sector. With its current Zacks Industry Rank of 153, this industry ranks in the bottom 40% of all industries, numbering over 250.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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Chewy (CHWY) : Free Stock Analysis Report

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