Barclays upgraded Chewy (CHWY) to Overweight from Equal Weight with a price target of $30, up from $19. The analyst thinks the company’s growth inflects in the second half of fiscal 2024 and sees upside to consensus estimates in fiscal 2025, with “incremental upside optionality” from vet clinics, international and advertising. Amazon (AMZN) is a competitive risk, but Temu probably isn’t, and Chewy’s valuation is attractive given the firm’s expectations for 30% average EBITDA growth over next three years, the analyst tells investors in a research note.
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