Can CHWY sustain its earnings momentum into 2026?

**Chewy's ability to sustain its earnings momentum into 2026 appears promising**, considering the following points: 1. **Financial Growth Projections**: RBC Capital Markets has raised its estimates for Chewy's first-quarter net sales growth to 7.6%, up from the previous 5.2%. This indicates a positive outlook for the company's revenue growth. Additionally, RBC anticipates an adjusted EBITDA margin of 5.8% for 2025 and 6.6% for 2026, suggesting steady profitability growth. 2. **Analyst Confidence**: The consensus rating for Chewy is "Buy" with an average analyst price target of $41.67, indicating optimism about the company's future performance. Analysts at RBC Capital Markets and JMP Securities have reiterated their positive ratings on Chewy, highlighting the company's resilience amid industry challenges and potential for growth. 3. **Strategic Initiatives**: Chewy has been diversifying its revenue streams and enhancing its value proposition through strategic initiatives. The company's expansion into the pet healthcare market and its focus on digital engagement are expected to contribute to its growth. 4. **Market Position and Trends**: The pet care industry is growing due to increasing pet adoption rates and rising spending on pet care products and services. Chewy's strong position in the large U.S. pet market and its status as a top e-commerce platform for pet products are key advantages. However, it's important to note that Chewy faces challenges such as stable and slower growth in the U.S. pet market post-pandemic normalization and potential impacts of consumer confidence on discretionary spending. The company will need to navigate these challenges effectively to sustain its earnings momentum.