CHWY - Chewy: Buy The Drop
2024-03-25 04:44:32 ET
Summary
- Chewy reported better-than-expected Q4 results, with significant free cash flow growth and consistent gross margins.
- The company is expanding its product offerings with Chewy Vet Clinics, creating a new revenue stream.
- Chewy is trading at a 16X P/E ratio, which is about 50% below the 1-year average P/E ratio.
Chewy ( CHWY ) reported much better than expected results for the fourth quarter which nonetheless caused the company’s shares to fall 10% after earnings. The online pet store retailer is convinced with strong free cash flow growth and consistent gross margins on its e-Commerce platform. The company is also making strategic moves by broadening its product offers and rolling out Chewy Vet Clinics, which is set to create a new revenue stream for the retailer. While shares of Chewy are not especially cheap from an earnings perspective, I believe that the risk profile here is still favorable!...
Chewy: Buy The Drop