Chewy Inc: Jefferies cuts target price to $23 from $31

Jefferies Group has further reduced its price target for Chewy Inc. (NYSE:CHWY), cutting it to $23 from $31, according to recent disclosures. The move reflects ongoing valuation concerns despite the company showing progress in key metrics. Chewy’s stock currently trades at $26.57, down 33% over the past six months.

For the fiscal year 2025, Chewy reported a 4% year-over-year increase in active customers and a 90 basis point expansion in margins. Annual revenue rose 6.2% to $12.6 billion, with diluted earnings per share reaching $0.52. The firm highlighted positive contributions of Autoship, Chewy+, and vet care to customer retention and revenue growth.

Looking ahead, Jefferies anticipates continued growth in fiscal 2026, with EBITDA growth expected to outpace revenue growth significantly. However, the firm is waiting for a more attractive entry point for the stock.

Institutional ownership of Chewy remains strong, with Jefferies Financial Group increasing its stake by 550.3% in the fourth quarter to 102,249 shares, valued at approximately $3.38 million. Other major institutional investors, including Vanguard and Federated Hermes, have also increased their holdings in recent quarters.

Analysts remain divided on Chewy’s outlook, with a consensus target price of $42.14 and a "Moderate Buy" rating. However, recent downward revisions in price targets by several firms underscore the cautious sentiment in the market.