The fourth-quarter earnings for Chewy Inc. (CHWY) ended January 31, 2021, have exceeded expectations. However, Chewy Inc. (NYSE: CHWY) went down by -2.36% in Thursday’s trading session, a drop equivalent to -$2.0 from the previous market close. During the trading period, the shares touched a low of $81.65, but a high of $87.27. According to data provided by Barchart, CHWY closed at $84.71 last night, with a trading volume of 6.12 million.
Chewy’s revenue in the fourth quarter increased 51 % YoY to $2.04, and its gross margin increased 25.5 %. Despite Wall Street’s expectations, earnings per share came in at $0.05. Despite losses of over $92.5 million at the end of the year, Chewy’s clientele increased by 43%.
Pet owners increased online consumer activity by a significant margin in 2020 when Chewy Inc. (CHWY) management celebrated an extremely successful year. This development was not a surprise to Chewy, which became the third-largest online pet store in the United States.
Moreover, self-isolation has motivated many Americans to buy more pets and dramatically increase their spending on existing ones. Additionally, they are expanding their business into new areas, including online veterinary consultations.
As a result, Chewy Inc.’s (CHWY) background remains favorable. Despite its BUY recommendation on CHWY, Wells Fargo set a target price of $ 140 before the quarterly report was published, suggesting substantial upside potential. According to Wells Fargo, Chewy’s online store is very popular and the CHWY stock’s customers are loyal. Since prices have dropped, this creates the possibility of an entry point.