What happened
Investors weren't too keen on the taste of Chewy (CHWY 0.19%) on Wednesday. The pet products specialist's share price fell by nearly 5%, a far steeper decline than the S&P 500's 1.6%, on the back of a price target cut from an analyst at an influential investment bank.
So what
Just before market open that day, Morgan Stanley prognosticator Lauren Schenk trimmed her price target on Chewy to $31 per share, lopping $1 off the previous level of $32. She maintained her equal weight (hold, in other words) recommendation on the stock.
It wasn't immediately clear why Schenk made her move, but she's not the only analyst currently tepid on Chewy's prospects. The latest researcher to initiate coverage on the stock, Baptista Research's Ishan Majumdar, also tagged it with a hold recommendation at the end of December. Majumdar's price target is $39 per share.
As with many stocks, however, professional opinions vary with Chewy. Last week, Needham & Co. analyst Anna Andreeva tapped the stock as a top pick within her coverage universe. She's extremely bullish on the stock, as she feels that the company is well positioned to grow its net sales this year, in addition to other positive factors. She currently rates the shares a buy at a price target of $55.
Now what
Although Chewy's viability as a stock is subject to opinion, it's indisputable that the company has put up some impressive numbers lately.
It surprised the market by posted a meaningful profit in its most recently reported quarter, as analysts were expecting a loss, and beat on the top line. Management also raised its guidance for full-year revenue and non-GAAP (adjusted) earnings before interest, taxes, depreciation, and amortization (EBITDA).
