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Chewy Stock: Why Analysts Say Boring May Be the Best Buy
Written by Gabriel Osorio-Mazilli. Published 9/30/2025.
Key Points
- Due to its strong business model, Chewy stock is harnessing attention from Wall Street analysts as one of the best plays in the consumer sector.
- Wall Street analysts are raising their price targets on the stock as they recognize its strong positioning.
- A recent $500 million buyback from management confirms the stock may be cheap today.
Safety is boring—but when markets are stretched thin, boring can be the smartest play. With the S&P 500 trading near record highs and the Federal Reserve cutting rates, investors should reconsider the assumption that this cycle will mirror the last. During COVID-19, rate cuts were purely stimulative, aimed at preventing deflation. Today, with inflation still hovering around 3%, the dynamics have shifted.
That's why stable, cash-generating businesses may become the go-to option for investors seeking shelter from volatility. Enter Chewy (NYSE: CHWY). Its subscription-based model offers predictability, and its loyal customer base delivers consistent revenue—traits that tend to stand out in uncertain markets.
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Get The Early Bird's Stock of the Day (Free)It's also why some analysts have already raised their price targets, aiming to get ahead of a potential upside move. If Chewy outperforms both its sector and the broader market, they'll be able to say they saw it coming.
Why Wall Street Likes Chewy Stock
Within the consumer staples sector, few names are as recession-resistant as Chewy. Whether the economy is booming or contracting, and whether inflation is squeezing wallets, pet spending tends to hold steady. Families consistently make room in their budgets for their pets, giving Chewy a durable revenue base.
That reliability is fueling growing confidence. The consensus price target for Chewy stock is now $45.84, implying roughly 16% upside from current levels. Some analysts are even more bullish: Michael Morton of Moffett Nathanson recently issued a Buy rating with a $48 target, suggesting 21% upside and putting the stock within striking distance of its 52-week high.
Beyond sentiment, the fundamentals support the bullish case. Chewy boasts a gross profit margin of 29.5% and a return on invested capital (ROIC) of 15.7%. ROIC is especially relevant because it correlates closely with long-term stock performance and measures how efficiently a company reinvests profits to create value.
Investors are clearly taking notice. Despite a high price-to-earnings (P/E) ratio of 113.3x—a steep premium compared to the retail sector average of 20.2x—buyers continue to step in. That premium reflects expectations of future growth and a willingness to pay for durable earnings potential. For more context, compare Chewy to its industry peers.
Institutional Optimism Builds
It's not just analysts sending a signal—institutions are piling in too. In August 2025, Invesco Ltd. boosted its Chewy stake by 34.7%, raising its position to $306.3 million, or 1.7% of the company.
While BC Partners sold some shares in the same period, that move reflected portfolio rebalancing rather than diminishing conviction—especially after Chewy's shares jumped 18.4% year-to-date, outperforming the S&P 500 by nearly five percentage points.
What's more telling is what happened next: Chewy repurchased the $500 million stake (roughly 3% of its market cap) directly from BC Partners. Rather than cashing out, management reinvested in the business—an action that signals strong insider confidence in Chewy's long-term value and supports analysts' raised targets.
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