Chewy stock was one of the biggest winners during the Covid-19 pandemic in 2020
Chewy, Inc. (NYSE:CHWY) is an American online retailer of pet food, products, supplies and prescriptions. The Florida-based company has partnered with more than 2,000 brands in the pet industry. Chewy was acquired by PetSmart for $3.35 billion in 2017, and began trading publicly in 2019. Since the company's initial public offering (IPO), the CHWY stock price has just about tripled in value.
Chewy stock's jaw-dropping growth didn’t really take off until Spring of 2020, as the Covid-19 pandemic forced people into lockdowns and limited brick-and-mortar retail. Chewy has been one of the biggest winners throughout this time period, CHWY now up about 265% year-to-date, and stacking approximately $1.4 billion in annual revenue. The company also reduced its net losses by nearly $80 million in 2020. Moreover, Chewy stock is not done ticking up. Chewy stock is continuing on its surge, yesterday hitting a fresh record high of $109.73. At its 52-week low, CHWY stock price was $20.62 per share.
Adding to the company's list accomplishments this year, Chewy stock has managed to outperform analyst expectations on all four of its earning reports. Following Chewy's latest earnings beat, CHWY received no fewer than eight price-target hikes. The company has also inched closer to profitability as a result of Chewy’s consistent earnings increases that have been reported quarterly.
From a fundamental point of view, Chewy stock is showing solid qualities that most growth stocks tend to lack. Chewy’s available cash outweighs its total debt by about $165 million. The company's balance sheet holds $505 million in cash and $340 in debt. The amazing year Chewy had in 2020 has also allowed the company to cut its net losses nearly in half since 2018, where Chewy reported a net loss of -$338 million.
The most promising aspect of investing in Chewy stock is the company's strong revenue growth. Chewy has increased its sales by more than 600% since 2016. The company has grown its revenue by more than $1 billion every fiscal year since producing just $900 million in 2016. The only issue for an investor to consider prior to purchasing Chewy stock, from a fundamental perspective, is the company's current massive valuation. Chewy currently has a market cap of $44 billion. Other than that, CHWY ticks off all the fundamental boxes needed for investors to identify a solid growth stock.