Chewy (NYSE:CHWY) Shares Gap Down - Here's What Happened

Key Points

• Chewy shares fell sharply at the open, dropping from a $23.27 close to $21.85 and recently trading near $21.55, despite the company reporting solid quarterly results.
• Chewy raised its fiscal 2026 revenue outlook to approximately $13.5 billion–$13.6 billion. Second-quarter revenue grew 7.3% to $3.33 billion, active customers rose 3.8% to 21.7 million, and net income increased to $80.5 million.
• The quarterly beat was modest, with revenue only slightly above estimates and adjusted EPS matching consensus; insider selling and recent analyst target cuts may also be weighing on investor sentiment. Wall Street’s overall rating remains “Moderate Buy,” with an average price target of $31.27.

Chewy (NYSE:CHWY - Get Free Report)'s stock price gapped down prior to trading on Wednesday . The stock had previously closed at $23.27, but opened at $21.85. Chewy shares last traded at $21.5460, with a volume of 3,727,690 shares traded.

More Chewy News

Here are the key news stories impacting Chewy this week:

• Positive Sentiment: Full-year outlook raised: Chewy now expects fiscal 2026 revenue of approximately $13.5 billion to $13.6 billion, well above the roughly $12.8 billion consensus estimate. Third-quarter revenue guidance of $3.3 billion to $3.4 billion was also consistent with expectations. Chewy's raised outlook gives shares a lift despite falling liquidity
• Positive Sentiment: Revenue and customer growth continued: Second-quarter sales rose 7.3% year over year to $3.33 billion, slightly exceeding estimates. Active customers increased 3.8% to 21.705 million, while Autoship sales reached $2.82 billion, or 84.6% of revenue. Chewy Announces Second Quarter 2026 Financial Results
• Positive Sentiment: Profitability improved: Adjusted EPS was $0.36, matching consensus and rising from $0.33 a year earlier. Net income increased to $80.5 million from $62 million, while net margin expanded year over year; adjusted EBITDA was $226.7 million, or a 6.8% margin. Chewy Fiscal Q2 Earnings Snapshot
• Neutral Sentiment: Quarterly beat was limited: Revenue exceeded estimates by only about 0.4%, and adjusted earnings matched forecasts rather than beating them. Gross margin remained unchanged at 30.4%, suggesting that the improved outlook—not a major quarterly surprise—was the primary catalyst. Chewy Reports Q2 Results
• Negative Sentiment: Insider selling may weigh on sentiment: Reported insider transactions over the past six months included seven sales and no purchases, including sales by Chief Executive Officer Sumit Singh. Chewy Q2 Revenue Rises 7.3% to $3.33 Billion

Wall Street Analyst Weigh In

A number of analysts have recently issued reports on the stock. Rosenblatt Securities initiated coverage on shares of Chewy in a report on Thursday, August 20th. They set a "neutral" rating and a $25.00 price target on the stock. Robert W. Baird decreased their price objective on shares of Chewy from $40.00 to $30.00 and set an "outperform" rating for the company in a report on Thursday, June 11th. Raymond James Financial boosted their price objective on shares of Chewy from $25.00 to $28.00 and gave the company an "outperform" rating in a report on Friday. UBS Group dropped their target price on shares of Chewy from $32.00 to $24.00 and set a "neutral" rating on the stock in a report on Thursday, June 11th. Finally, Jefferies Financial Group reaffirmed a "hold" rating and issued a $23.00 target price on shares of Chewy in a research report on Thursday, June 11th. One investment analyst has rated the stock with a Strong Buy rating, eighteen have assigned a Buy rating and seven have given a Hold rating to the company's stock. According to data from MarketBeat.com, Chewy has an average rating of "Moderate Buy" and an average price target of $31.27.

Chewy Price Performance

The firm has a 50-day simple moving average of $22.44 and a 200-day simple moving average of $23.17. The firm has a market capitalization of $8.67 billion, a PE ratio of 35.33, a PEG ratio of 0.94 and a beta of 1.42.

Chewy (NYSE:CHWY - Get Free Report) last released its quarterly earnings results on Wednesday, September 9th. The company reported $0.36 EPS for the quarter, beating the consensus estimate of $0.18 by $0.18. Chewy had a net margin of 1.99% and a return on equity of 60.02%. The firm had revenue of $3.33 billion during the quarter, compared to analyst estimates of $3.32 billion. During the same quarter in the prior year, the firm earned $0.33 EPS. The business's revenue for the quarter was up 7.3% compared to the same quarter last year. Equities analysts expect that Chewy will post 0.8 earnings per share for the current year.

Insider Transactions at Chewy

In related news, General Counsel Da-Wai Hu sold 4,203 shares of the business's stock in a transaction that occurred on Monday, June 29th. The shares were sold at an average price of $19.49, for a total transaction of $81,916.47. Following the completion of the sale, the general counsel directly owned 4,103 shares in the company, valued at approximately $79,967.47. The trade was a 50.60% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. Company insiders own 0.34% of the company's stock.

Institutional Inflows and Outflows

Several institutional investors have recently added to or reduced their stakes in the business. Osterweis Capital Management Inc. purchased a new stake in shares of Chewy in the 2nd quarter worth $30,000. Los Angeles Capital Management LLC purchased a new position in Chewy during the fourth quarter valued at $31,000. Harbour Investments Inc. lifted its position in Chewy by 81.4% during the fourth quarter. Harbour Investments Inc. now owns 907 shares of the company's stock valued at $30,000 after purchasing an additional 407 shares in the last quarter. Modus Advisors LLC bought a new stake in Chewy during the fourth quarter valued at about $34,000. Finally, EverSource Wealth Advisors LLC grew its holdings in Chewy by 412.2% during the second quarter. EverSource Wealth Advisors LLC now owns 1,091 shares of the company's stock valued at $46,000 after purchasing an additional 878 shares during the period. 93.09% of the stock is currently owned by institutional investors.

Chewy Company Profile

Chewy, Inc NYSE: CHWY is a leading e-commerce retailer specializing in pet food, supplies and services. The company offers a comprehensive assortment of products for dogs, cats, fish, birds and other small animals, including prescription medications, veterinary health products, grooming essentials and toys. Through its online platform and mobile app, Chewy provides an intuitive shopping experience with features such as Autoship, ensuring regular deliveries of pet essentials at schedule intervals.

Founded in 2011 by Ryan Cohen and Michael Day, Chewy initially operated under the name Mr.

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