Chewy Rises Most Since July After RBC Call for Profitability
(Bloomberg) -- Chewy Inc. jumped as much as 11%, its biggest gain since July 24, after being upgraded by RBC Capital Markets analyst Mark Mahaney, who wrote that fiscal 2020 could be the online pet retailer’s first year of break-even earnings before interest, taxes, depreciation and amortization.
- Mahaney raised his rating to outperform from sector perform; he said Chewy has strong, sustainable fundamentals and benefits from a large market opportunity and should continue to generate premium revenue growth
- Sees Chewy as “fundamentally strong” with 30% growth in active customers and 70% of revenue on Autoship with near-term traffic trends still consistent
- Maintains $38 price target
- Stock has 10 buy ratings, 3 holds, 0 sells; the average price target is $36, according to data compiled by Bloomberg
- Chewy is estimated to report fiscal fourth-quarter results in mid-April
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