Chewy Gets A Bite Of Confidence: Morgan Stanley Upgrades To Overweight Despite Market Gloom
Portfolio Pulse from Lekha Gupta
Morgan Stanley analyst Lauren Schenk has upgraded Chewy Inc (NYSE:CHWY) to Overweight from Equal-Weight, despite lowering the price target from $31 to $28. Schenk notes that CHWY's decline of over 50% since mid-July due to customer growth concerns is overdone. She sees CHWY still gaining market share and expects better-than-expected revenue growth and ongoing margin expansion. She also forecasts CHWY’s EBITDA margin of 5% and 10% in FY25 and FY30, respectively.
October 31, 2023 | 6:25 pm
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Morgan Stanley has upgraded Chewy Inc to Overweight from Equal-Weight, despite lowering the price target from $31 to $28. The analyst sees the company's recent decline as overdone and expects better-than-expected revenue growth.
The upgrade from Morgan Stanley is a positive signal for Chewy Inc. Despite the lowered price target, the analyst's view that the company's recent decline is overdone and the expectation of better-than-expected revenue growth could boost investor confidence and potentially drive the stock price up in the short term.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100