Chewy's Autoship Model: A Key Driver of Analyst Optimism and Investment Narrative

Chewy's strong subscription-based Autoship model and expected earnings and revenue growth have drawn analyst optimism, with Evercore ISI highlighting its robust recurring revenue stream and innovation-focused approach. This has reinforced themes of customer engagement and growing pet health and advertising offerings, but the company's ongoing reliance on Autoship remains a risk. Analysts expect Chewy to reach $15.1 billion in revenue and $466.3 million in earnings by 2028, with a fair value of $46.10, an 11% upside to its current price.

Chewy Inc. (CHWY) has recently garnered strong analyst optimism, with a focus on its robust subscription-based Autoship model and expectations for significant earnings and revenue growth. Evercore ISI and other analysts have underscored Chewy's recurring revenue stream and innovation-focused approach, which are central to the company's investment narrative. This optimism has been bolstered by recent earnings reports and guidance, as well as strategic expansions in pet health and advertising offerings.

Chewy's Autoship program, which accounts for over 80% of its sales, has been a key driver of its recurring revenue model. The company's ability to grow this segment and maintain customer engagement is a critical factor in its investment outlook. Analysts expect Chewy to reach $15.1 billion in revenue and $466.3 million in earnings by 2028, assuming a 7.7% annual revenue growth rate [1].

The recent surge in Chewy's share price, coupled with analyst optimism, has reinforced themes of customer engagement and growing pet health and advertising offerings. However, the company's ongoing reliance on Autoship remains a risk. If consumer preferences shift away from subscription services, this could negatively impact Chewy's growth prospects.

Institutional investors have also shown confidence in Chewy, with several funds raising their stakes in the company. For instance, Jump Financial LLC acquired a new position in Chewy during the first quarter of 2025, purchasing 161,835 shares valued at approximately $5.26 million [2]. Additionally, major shareholder Argos Holdings sold 29.9 million shares for a total of $1.25 billion, while other insiders also reduced their stakes.

Despite the optimism, investors should be aware of the potential risks associated with Chewy's business model. The company's future growth may be sensitive to changes in active customer trends, and any shifts in consumer preferences could impact its subscription-based revenue stream.

References:
[1] https://finance.yahoo.com/news/analyst-optimism-chewys-chwy-autoship-101147237.html
[2] https://www.marketbeat.com/instant-alerts/filing-jump-financial-llc-takes-position-in-chewy-chwy-2025-08-25/