Chewy upgraded to Buy at Argus on ‘impressive’ history of growth

As previously reported, Argus upgraded Chewy (CHWY) to Buy from Hold with a $42 price target The company offers an impressive history of growth, with revenue having tripled to over $11B since its 2019 IPO, the analyst tells investors in a research note. At a recent investor day, Chewy management has also set achievable three-to-five-year goals of high single-digit sales growth and an adjusted EBITDA margin greater than 10%, and this can be exceeded, the firm states. Argus adds that it has a positive view of Chewy’s focus on nondiscretionary pet products and services, which represent about 85% of revenue while further citing the recurring sales from its autoship service, which provides predictable income and helps the company efficiently manage its operations.