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The most recent trading session ended with Chewy (CHWY) standing at $38.62, reflecting a +1.26% shift from the previouse trading day's closing. The stock exceeded the S&P 500, which registered a gain of 0.72% for the day. Meanwhile, the Dow gained 0.3%, and the Nasdaq, a tech-heavy index, added 1.35%.
The online pet store's shares have seen an increase of 2.89% over the last month, not keeping up with the Retail-Wholesale sector's gain of 6.17% and outstripping the S&P 500's gain of 1.02%.
The investment community will be paying close attention to the earnings performance of Chewy in its upcoming release. The company's earnings per share (EPS) are projected to be $0.20, reflecting a 11.11% increase from the same quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $3.2 billion, up 13.11% from the year-ago period.
It is also important to note the recent changes to analyst estimates for Chewy. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.32% downward. Currently, Chewy is carrying a Zacks Rank of #3 (Hold).
Digging into valuation, Chewy currently has a Forward P/E ratio of 30.76. This expresses a premium compared to the average Forward P/E of 21.67 of its industry.
We can also see that CHWY currently has a PEG ratio of 0.83. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Internet - Commerce industry had an average PEG ratio of 1.22 as trading concluded yesterday.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This industry, currently bearing a Zacks Industry Rank of 70, finds itself in the top 28% echelons of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.