Chewy (CHWY) Gains As Market Dips: What You Should Know

CHWY

Chewy (CHWY - Free Report) closed at $39.26 in the latest trading session, marking a +1.19% move from the prior day. This move outpaced the S&P 500's daily loss of 0.15%. Elsewhere, the Dow lost 0.28%, while the tech-heavy Nasdaq added 3.16%.

Coming into today, shares of the online pet store had lost 13.97% in the past month. In that same time, the Consumer Staples sector lost 1.77%, while the S&P 500 lost 5.39%.

Chewy will be looking to display strength as it nears its next earnings release, which is expected to be March 22, 2023. On that day, Chewy is projected to report earnings of -$0.12 per share, which would represent a year-over-year decline of 9.09%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.64 billion, up 10.71% from the year-ago period.

Investors might also notice recent changes to analyst estimates for Chewy. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Chewy is currently sporting a Zacks Rank of #1 (Strong Buy).

In terms of valuation, Chewy is currently trading at a Forward P/E ratio of 314.6. For comparison, its industry has an average Forward P/E of 16.51, which means Chewy is trading at a premium to the group.

Meanwhile, CHWY's PEG ratio is currently 15.73. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Consumer Products - Staples industry currently had an average PEG ratio of 1.99 as of yesterday's close.

The Consumer Products - Staples industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 147, which puts it in the bottom 42% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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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