Analysts expect Chewy Q4 results to be in-line

By Sam Boughedda

Online pet product retailer Chewy (NYSE:) is set to post its fourth-quarter results on March 22, with analysts at Wedbush and BofA maintaining their positive stances on the stock ahead of the release.

Wedbush has an Outperform rating and a $55 per share price target on the stock. Analysts told investors in a note that the firm “stay positive” on CHWY into its earnings.

“While buy-side expectations for the quarter and guide have fallen, we expect 4Q22 top and bottom-line results about in line with sell-side consensus and expect the company to initiate 2023 revenue and margin guidance better than increasingly bearish expectations,” the analysts wrote.

Meanwhile, BofA maintained a Buy rating and a $54 price target on the stock.

“Consensus estimates 20.55mn TTM active customers (-0.5% y/y), net sales of $2.64bn (vs. guidance of $2.63-$2.65bn implying 10-11% y/y growth), and Adj. EBITDA of $25.6mn (1.0% margin). This is in line with our projected revenue/EBITDA of $2.64bn/$26mn,” wrote analysts.

“We expect macro headwinds to continue pressuring discretionary spend, and biggest risk to the quarter is customer growth turning substantially negative again. We estimate 1Q revenue guidance of $2.68bn-$2.70bn (vs. Street at $2.69bn), implying +2% q/q revenue growth.”

Chewy shares are down more than 4% on Wednesday at the time of writing.