Analysts Cut Chewy Price Target Post Q3 Results

Several analysts lowered their price target on Chewy Inc CHWY post Q3 results. Chewy is an e-commerce pet care retailer in the U.S.

• Barclays analyst Trevor Young lowered the price target to $64 from $90, suggesting a 23% upside, and kept an Equal Weight rating on the shares.
• Young said the company reported Q3 revenue was in line with the Street, but EBITDA was well below expectations as more aggressive competitor pricing, inbound freight, and product cost inflation muted margin expansion more than anticipated.
• UBS analyst Michael Lasser reduced the firm's price target on Chewy to $46 from $71 and kept a Sell rating on the shares.
• Lasser added that Chewy could benefit from strategies such as a move into healthcare and discretionary products, but these positives would not materialize until the latter part of FY22.
• Wells Fargo analyst Brian Fitzgerald lowered the price target on Chewy to $90 from $110 and kept an Overweight rating on the shares, implying a 73% upside.
• While Chewy reported a mixed Q3 and offered a muted Q4 outlook as supply chain woes and higher-cost inputs create a near-term drag on both top-line and profitability trends, Fitzgerald was encouraged by incremental wallet share gains and improved customer acquisition efficiency, and the announcement of an expansion into the pet insurance market in partnership with Trupanion Inc TRUP.
• Morgan Stanley analyst Lauren Schenk lowered the firm's price target on Chewy to $74 from $81, implying a 42% upside.
• Schenk sees headwinds as transitory and points to gross adds, customer retention, and marketing efficiency as key positives, but while she argues the "valuation appears compelling," she keeps an Equal Weight rating on Chewy shares given her view that the stock is "likely a show-me story near-term."
• Wedbush analyst Seth Basham lowered the price target on Chewy to $55 from $70 and kept a Neutral rating on the shares, 
• The analyst said some of the pressures Chewy is facing are transitory, but others could persist, weighing on the revenue and EBITDA growth outlook.
• Price Action: CHWY shares are trading lower by 7.89% at $51.86 on the last check Friday.