Chewy Is Unlocking Operating Leverage

Gen Z Investor
293 Followers
(9min)

Summary

  • Chewy stock fell over 75% since 2021, due to slower growth, but is now showing real earnings and operating leverage providing a possibility to capital appreciation from this point.
  • Revenue growth for Chewy dropped from 45% in 2021 to 3% in 2024, leading to a stock price collapse and a focus on profitability.
  • Chewy's business model is supported by long-term pet industry trends and operational efficiency, making it a careful buy.

Pequeño cachorro de chihuahua sentado tranquilamente en un sofá en casa.

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Chewy (NYSE:CHWY) stock has been in trouble since the beginning of 2021. After falling more than 75%, the company is finally producing real cash flows and finding operating leverage. This, combined with some slow growth, makes the stock a

This article was written by

293 Followers
I am a dedicated financial risk manager and investor specializing in financials, consumer, and technology industries. I have been involved in the investing world for over seven years, making deep analyses and managing different types of portfolios.I believe in deep research, prioritizing business model trends to understand the companies' perspectives in the future before short-term market trends or stock prices. This research philosophy is auspicious to find good growth investment opportunities for the long term while also avoiding dangerous financial instruments presented in the markets. As a relatively young investor, I consider my views a valuable approach to analyzing and researching new technologies and enhancements, as well as the impact these could have on the younger generations and the investments made on these.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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