Sep. 12 at 2:02 AM
JPMorgan downgraded Chewy to Neutral from Overweight and cut its price target to
$24 from
$29, citing continued pressure on organic growth from macroeconomic headwinds. Analyst Doug Anmuth noted that Chewy shares fell 9% after earnings as consumer demand remained weak, particularly in discretionary and premium products, with no meaningful recovery during the second quarter.
Despite the challenging environment, Chewy continued gaining market share, growing roughly 2-3 times faster than the overall pet category. Customer additions, retention, reactivations and engagement improved, while recent acquisitions SmartPak and Modern Animal exceeded expectations. Chewy added 208,000 active customers net during the quarter, including 43,000 from SmartPak, and raised its full-year net sales outlook by about
$40 million at the midpoint.
$CHWY