Chewy, Inc. (NYSE: CHWY) shares were on a rollercoaster on Wednesday, December 10, 2025, after the online pet retailer reported strong fiscal third‑quarter 2025 results but paired them with a revenue outlook that investors viewed as conservative. The headlines now range from “earnings beat” to “EPS miss” and “soft guidance,” reflecting how nuanced the story around Chewy stock has become. [1]
This article pulls together the key numbers, market reaction, and fresh analyst and valuation commentary investors are reading today.
Chewy stock on December 10, 2025: high‑volatility trading day
Chewy stock has been bouncing around all session following the Q3 FY2025 release before the opening bell.
- As of early afternoon on December 10, 2025, CHWY was trading around $34.84, up a fraction of a percent from the prior close.
- Intraday, the stock has traded roughly between $32.20 and $37.38, underscoring how divided investors are on the results and guidance.
- Earlier news reports noted that shares were up nearly 4% in pre‑market trading immediately after the headline beat on adjusted earnings, before swinging to losses of about 4–7% as investors digested the Q4 outlook and mixed EPS framing. [2]
Volatility is nothing new for Chewy stock: over the past year the shares are up about 12%, but they remain deeply underwater over longer horizons, with three‑year returns around –23% and five‑year returns near –58% according to recent valuation work. [3]
Q3 2025 results: revenue beat, margin expansion, and strong cash generation
Chewy reported fiscal third‑quarter 2025 results for the period ended November 2, 2025. The company’s own press release and multiple data providers broadly agree on the key numbers: [4]
- Net sales: about $3.12 billion, up 8.3% year over year, slightly above the Street’s ~$3.10 billion expectation.
- Gross margin:29.8%, up 50 basis points from a year ago, reflecting better mix and operational efficiencies.
- Net income (GAAP):$59.2 million, versus $3.9 million in the prior‑year quarter. Net margin improved to 1.9%, up 180 basis points.
- GAAP diluted EPS:$0.14, up from $0.01 a year ago.
- Adjusted net income:$135.7 million, up about $50.7 million year over year.
- Adjusted diluted EPS:$0.32, versus $0.20 a year ago and roughly $0.30 expected by analysts.
- Adjusted EBITDA:$180.9 million, with margin expanding to 5.8%, a 100‑basis‑point improvement year over year.
- Free cash flow: about $175.8 million for the quarter, up roughly 16% from the prior year, with year‑to‑date free cash flow above $330 million.
On top of that, Chewy’s core operating metrics point to a business that is still growing in both customers and spend:
- Active customers: about 21.2 million, up 4.9% year over year.
- Net sales per active customer (NSPAC):$595, also up 4.9%.
- Autoship sales: roughly $2.61 billion, up 13.6% year over year and accounting for 83.9% of total net sales (up from 80%). [5]
In the company’s commentary, CEO Sumit Singh highlighted that Chewy is “outperforming the pet category” and growing profits faster than sales, crediting the mix shift toward higher‑margin categories and the structural advantages of its Autoship subscription model. [6]
Why some headlines say Chewy “beat” and others say it “missed” EPS
The apparent contradiction across today’s coverage comes down to GAAP vs. non‑GAAP:
- On a GAAP EPS basis, MarketBeat notes that Chewy’s $0.14 EPS was below a consensus estimate near $0.31, prompting some outlets to describe the quarter as an EPS “miss.” [7]
- On an adjusted EPS basis (excluding stock‑based compensation and other items), Chewy’s $0.32 topped the roughly $0.30 analysts were modeling, which is why several earnings summaries characterize the quarter as an “EPS beat.” [8]
Revenue, margins, and cash flow were unambiguously better than a year ago and modestly ahead of expectations, which helps explain the initial positive reaction in pre‑market trading.
Q4 and full‑year 2025 guidance: conservative revenue, solid profitability
Where sentiment turns more cautious is Chewy’s guidance for Q4 and the full fiscal year 2025.
According to Chewy’s investor materials and analyst summaries: [9]
- Fiscal Q4 2025 guidance
- Net sales:$3.24–$3.26 billion
- Adjusted diluted EPS:$0.24–$0.27
- Full‑year fiscal 2025 guidance
- Net sales:$12.58–$12.60 billion
- Adjusted EBITDA margin:5.6–5.7%
On the one hand, the EPS guidance is above consensus: MarketBeat notes the company’s Q4 EPS range of $0.24–$0.27 compares favorably with Street expectations closer to $0.22. [10]
On the other hand, revenue guidance is only in line to slightly below what many analysts had penciled in (around $3.30 billion), implying a modest deceleration in top‑line growth into the holiday quarter. That combination—better profitability but slower sales growth than hoped—is why multiple outlets describe the Q4 outlook as “soft” or “cautious,” and why shares turned lower even after a fundamentally strong Q3 print. [11]
Autoship, healthcare, and SmartEquine: Chewy’s growth engine
Beyond the quarter’s numbers, investors are laser‑focused on Chewy’s structural growth drivers:
Autoship and loyalty programs
Chewy’s Autoship subscription program—where customers schedule recurring deliveries of pet food, medications, and other essentials—has become the backbone of the business:
- In Q3, Autoship accounted for nearly 84% of net sales, up from 80% a year earlier. [12]
- A recent Zacks analysis of Q2 fiscal 2025 noted that Autoship sales were growing faster than Chewy’s overall revenue and were especially strong in higher‑value categories like consumables and pet health. [13]
Autoship orders tend to be higher frequency and more predictable, which helps Chewy optimize logistics, improve inventory turns, and drive gross‑margin expansion—a dynamic clearly visible in the step‑up from roughly 29.0% gross margin a year ago to 29.8% in Q3. [14]
Chewy is also pushing engagement through Chewy+, its membership offering, which Zacks notes is associated with stronger Autoship participation, higher mobile engagement, and faster growth in sales per active customer. [15]
SmartEquine / SmartPak acquisition
Another key theme in current coverage is Chewy’s move into equine health and wellness via its agreement to acquire SmartPak Equine (SmartEquine) from Covetrus:
- On October 30, 2025, Chewy announced an all‑cash deal to acquire SmartEquine, a leading U.S. provider of equine health products with a subscription‑based supplement program and personalized nutrition plans. [16]
- The transaction is expected to close in Chewy’s Q4 2025, financed from existing cash. [17]
- Industry coverage emphasizes that the deal gives Chewy more exposure to higher‑margin animal health and wellness verticals and adds another subscription‑oriented revenue stream that rhymes with its Autoship model. [18]
Analysts and industry commentators see SmartEquine as strategically aligned with Chewy’s push deeper into pet healthcare and wellness, a segment where customers are less price‑sensitive and where recurring, medically oriented purchases can support higher margins over time.
What Wall Street thinks about Chewy stock today
Fresh analyst and data‑provider commentary around December 10 paints a picture of cautious optimism with pockets of skepticism.
Consensus ratings and price targets
- MarketBeat data show Chewy carries a “Moderate Buy” consensus rating, with two analysts at Strong Buy, 19 at Buy, and four at Hold. [19]
- The average 12‑month price target sits around $46–47 per share, implying roughly 30–35% upside from today’s mid‑$30s price. [20]
- Benzinga’s pre‑earnings preview similarly highlighted that 16 analysts rate CHWY “Outperform,” with an average target near $46, again implying upside from current levels. [21]
At the same time, some of those targets have been trimmed slightly in recent months, with several firms nudging expectations down into the low‑to‑mid‑$40s even as they maintain bullish ratings. [22]
Zacks, for its part, assigns Chewy a Rank #3 (Hold) and notes that while the company has delivered a modest average earnings beat in recent quarters, it trades at a forward P/E multiple well above the retail industry average. [23]
Diverging published opinions
Recent articles highlight the split in perception:
- A Tokenist earnings write‑up describes Q3 as a clean beat on revenue and adjusted EPS with solid margin expansion and an upbeat long‑term growth narrative. [24]
- GuruFocus similarly frames the quarter as “beating expectations” but notes that shares dipped on cautious guidance, suggesting investors wanted a stronger top‑line outlook. [25]
- A Simply Wall St piece from December 9 argues that Chewy screens as undervalued on a discounted cash‑flow (DCF) basis but looks expensive on earnings multiples, capturing the tension between long‑term growth potential and near‑term valuation. [26]
- On the bearish side, a Seeking Alpha article from December 8 downgraded Chewy to a “Sell” rating with a $30 price target, arguing that growth has slowed to the mid‑ to high‑single digits, active customer growth had stalled before Q3, and the stock’s premium valuation leaves little room for disappointment. [27]
In other words, bullish investors see a profitable, cash‑generative pet platform that may be trading at a discount to long‑term intrinsic value, while skeptics focus on slowing growth versus a very rich multiple.
Valuation check: a growth story with a premium price tag
Chewy’s valuation is central to the debate around CHWY stock.
By traditional multiples
MarketBeat and other data sources show that, as of December 10, 2025: [28]
- Chewy trades at a trailing P/E around 95–100×.
- Its PEG ratio (price/earnings to growth) is quoted around 8–9×, highlighting that even accounting for earnings growth, the stock remains expensive relative to typical specialty retail peers.
- Beta of roughly 1.6 underlines that Chewy is more volatile than the broader market.
Zacks estimates imply earnings growth in the low‑20% range for fiscal 2026 and 2027, which would gradually bring the P/E multiple down – but only if Chewy delivers consistently on those expectations. [29]
By discounted cash‑flow (DCF) models
Simply Wall St’s December 9 analysis uses a two‑stage free cash‑flow‑to‑equity model and recent free cash flow of roughly $447 million, projecting that figure could rise to about $1.23 billion by 2030 as margins expand. Discounting those cash flows, they arrive at an intrinsic value near $57.50 per share, which implies the stock is trading at close to a 40% discount to that DCF estimate. [30]
However, the same analysis points out that Chewy’s current P/E near 95× is far above both the specialty retail average (~20×) and even an internally estimated “fair” ratio of about 28×, leading them to call the shares “overvalued on earnings” but “undervalued on cash‑flow scenarios.” [31]
The upshot: valuation depends heavily on your narrative. If you believe Chewy can sustain high‑teens to low‑20% earnings growth through a mix of Autoship, healthcare, and acquisitions like SmartEquine, today’s price might look reasonable or even attractive. If you think growth will stay stuck in the high‑single‑digit range, the multiples look demanding.
Key risks investors are watching
Today’s commentary also highlights several risks that could shape Chewy’s stock trajectory from here:
- Growth vs. expectations
Q3’s 8.3% revenue growth is solid but not explosive. Several bearish voices argue that for a business trading at a tech‑style multiple, growth in the mid‑single to high‑single digits may not be enough to justify the valuation. [32] - Competitive pressure
Chewy faces intense competition from Amazon, big‑box retailers, and newer pet‑focused e‑commerce players. Maintaining price competitiveness while expanding margins is a delicate balancing act. - Execution on SmartEquine and health & wellness
The SmartEquine acquisition and broader push into pet healthcare offer higher margins but require integration, regulatory navigation, and effective cross‑selling to Chewy’s existing base. Execution missteps could erode the expected returns from these deals. [33] - Insider and institutional activity
MarketBeat notes recent insider selling (around 84,000 shares over the last quarter) and highlights that institutions own more than 90% of the float. Heavy institutional ownership can be a double‑edged sword: it supports liquidity but can amplify moves if funds collectively rotate out. [34] - Macro and consumer trends
The pet category has historically been resilient, but discretionary pet spending can still soften if consumer budgets remain under pressure. Chewy’s higher‑end offerings and wellness products will need to prove their staying power in different macro environments.
Chewy stock outlook: information, not a recommendation
As of December 10, 2025, the Chewy story is finely balanced:
- Fundamentals: Q3 showed rising margins, strong cash generation, and renewed growth in both customers and sales per customer, supported by a powerful Autoship engine. [35]
- Strategy: The company is doubling down on subscriptions and health & wellness, with SmartEquine poised to extend that model into equine care and potentially strengthen Chewy’s long‑term competitive moat. [36]
- Market reaction: The stock’s whipsaw trading range today shows that investors are still debating whether Chewy is a reasonably priced compounder or a richly valued “story stock” that needs flawless execution. [37]
- Street view: Most covering analysts rate CHWY a Buy or Outperform with targets clustering in the mid‑$40s, but some high‑profile voices argue the valuation is stretched and have moved to Sell with targets closer to $30. [38]
For readers following Chewy stock for trading or long‑term investment purposes, the key questions are:
- Do you believe Chewy can keep expanding margins and free cash flow at the pace implied by optimistic DCF models?
- How comfortable are you owning a high‑volatility, high‑multiple stock where even “good” quarters can be punished if guidance doesn’t quite meet lofty expectations?
References
1. investor.chewy.com, 2. finance.yahoo.com, 3. simplywall.st, 4. investor.chewy.com, 5. investor.chewy.com, 6. investor.chewy.com, 7. www.marketbeat.com, 8. tokenist.com, 9. quartr.com, 10. www.marketbeat.com, 11. www.barrons.com, 12. investor.chewy.com, 13. www.nasdaq.com, 14. investor.chewy.com, 15. www.nasdaq.com, 16. investor.chewy.com, 17. www.webull.com, 18. www.retailtouchpoints.com, 19. www.marketbeat.com, 20. www.marketbeat.com, 21. www.benzinga.com, 22. www.marketbeat.com, 23. www.nasdaq.com, 24. tokenist.com, 25. www.gurufocus.com, 26. simplywall.st, 27. seekingalpha.com, 28. www.marketbeat.com, 29. www.nasdaq.com, 30. simplywall.st, 31. simplywall.st, 32. seekingalpha.com, 33. investor.chewy.com, 34. www.marketbeat.com, 35. investor.chewy.com, 36. investor.chewy.com, 37. simplywall.st, 38. www.marketbeat.com
