Piper Sandler Maintains Overweight on Chewy with $48 Target and 7-8% Growth
Piper Sandler maintained an Overweight rating on Chewy with a $48 target, citing pet ownership headwinds after Tractor Supply’s earnings and a 42% BC Partners stake overhang. It noted a 3% EBITDA beat in 2025, down from 22% in 2024, sees 7-8% sales growth with a 6.6% margin for 2026.
1. Rating Maintained
Piper Sandler reaffirmed an Overweight rating on Chewy and set a $48 price target on February 5. The firm highlighted weaker pet ownership trends following Tractor Supply’s earnings report and noted the overhang from BC Partners’ 42% ownership stake.
2. Narrowed EBITDA Beat
Chewy’s 2025 EBITDA beat narrowed to 3%, compared with an average 22% beat in 2024. Piper Sandler cited this moderation as a sign of a more conservative earnings trajectory.
3. 2026 Sales and Margin Guidance
The firm expects Chewy to guide for 7-8% sales growth in 2026, slightly below the Street’s 8% forecast, and to bracket a 6.6% consensus EBITDA margin with potential upside from improved operating leverage.
4. Morgan Stanley Outlook
In January, Morgan Stanley raised its Chewy price target to $51 while retaining an Overweight rating. The firm noted that internet names delivering positive ROIC via GenAI or GPU-enabled technologies are likely to attract market reward this year.