To The Moon

$Chewy, Inc.(CHWY)$ is expected to release earnings on 20 Mar 2024 after the market closes (AMC).

Chewy Inc is expected to show a rise in quarterly revenue when it reports results for the period ending 31 Jan 2024. It is expected to report a 2.4% increase in revenue to $2.773 billion from $2.71 billion a year ago, according to the mean estimate from 23 analysts, based on LSEG data.

The company's guidance on 06 Dec 2023 for the period ended 31 Jan, was for revenue between $2.78 billion and $2.80 billion.

Technical is showing that CHWY is currently experiencing a downtrend, but things might change for the consumer staples sector which Chewy is part of it, any signs of inflation coming back, would push investors into defensive stocks like Chewy.

If we look at how Chewy make a recovery from selling(bearish) to buying(bullish), the selling sentiment seems to be ended based on the daily chart below.

We could see Chewy making a recovery for its stock price from what we have seen from Oct 2023. I would be monitoring and prepare to take position in this stock.

Chewy (CHWY) Last Reported Earnings

CHWY last reported earnings on 06 Dec 2023 after the market close (AMC). CHWY shares declined -0.6% the day following the earnings announcement to close at 19.23. Following its earnings release, 103 days ago, CHWY stock has drifted -12.4% lower.

From the time it announced earnings, CHWY traded in a range between 15.78 and 25.24. The last price (16.84) is closer to the lower end of range.

But we can see that Chewy has provided EPS surprise for many quarters, never one missed so far.

Estimated implied straddle for upcoming earnings is 15.1%. If we look at how Chewy has reacted after its earnings, it look like we might see a small dip before coming up with a rise.

Chewy (CHWY) Post Earnings Movement

The options market overestimated CHWY stocks earnings move 67% of the time in the last 12 quarters. The predicted move after earnings announcement was ±12.2% on average vs an average of the actual earnings moves of 10.2% (in absolute terms).

Option valuation is suggesting that Chewy is overvalued, hence, we could expect some price volatility on the upside, there could be an higher number of call volume.

Summary

Chewy looks to gather some upside in its stock price following a better-than-expected revenue, we could be seeing Chewy going into a long period of upside after this earnings release.

Appreciate if you could share your thoughts in the comment section whether you think Chewy would be able to create a long period of upside following this upcoming earnings release.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.