Chewy Shares Soar 2.01% to 2023 High Ahead of Earnings

Chewy(CHWY) shares rose 0.44% today, reaching their highest level since February 2023 with an intraday gain of 2.01%.

The strategy of buying CHWY shares after they reach a recent high and holding for 1 week resulted in a 32.27% return over the past five years, compared to a benchmark return of 50.09%, with an excess return of -17.82% and a CAGR of 12.38%. The strategy had a maximum drawdown of -64.74%, a Sharpe ratio of 0.24, and a volatility of 50.92%.

Chewy's stock has seen substantial growth, with a 41% increase year-to-date and a 113% rise over the past 12 months, peaking at $47.55 on June 3. This rapid ascent has sparked valuation concerns, leading analysts to reassess their ratings. Jefferies, for instance, downgraded the stock from "Buy" to "Hold," citing stretched valuations as a reason for caution.

UBS, on the other hand, increased its price target for Chewy from $36 to $46 while maintaining a neutral rating. This adjustment reflects a balanced view, acknowledging the company's potential while remaining cautious about its current valuation.

Adding to the mix, Chewy is set to release its earnings report around June 11. Analysts are expecting modest adjustments to guidance, taking into account current spending trends and the prevailing valuation concerns. This upcoming report will be crucial in shaping investor sentiment and could influence future stock movements.