Chewy, Inc. (CHWY) shares closed at $34.89 on November 22, 2024, down 2.73% from the previous day's close of $35.87. The stock opened at $35.77 and reached a low of $33.37 during the trading session, with a volume of 6,145,361 shares, close to its average. The decline was primarily driven by a report from Cleveland Research indicating that Chewy's October sales were below expectations, raising concerns about the company's performance amid a challenging market environment. Additionally, the broader pet accessories market is facing headwinds, with non-essential spending pressures and a slowdown in pet household formation expected to persist into the first half of next year, impacting demand for hard goods.
Further pressure on Chewy's stock came from Deutsche Bank's price target adjustment, which raised the target from $24 to $28 but maintained a Hold rating. Despite the increase, the new target remains below the current trading price, contributing to the negative sentiment. Deutsche Bank's analysis suggests that while Chewy's revenue is accelerating towards the high end of its guidance for the upcoming Q3 report on December 4th, the broader industry data does not yet indicate a significant uptick in pet household formation.