Why Chewy (CHWY) Stock Is Trading Lower Today
Shares of e-commerce pet food and supplies retailer Chewy (NYSE:CHWY) fell 9.7% in the afternoon session after the company reported underwhelming first-quarter 2025 results. Margins dipped slightly and customer growth was modest. Free cash flow margin also declined, highlighting both top- and bottom-line weaknesses. Overall, this was a softer quarter.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Chewy? Access our full analysis report here, it's free.
Chewy's shares are very volatile and have had 22 moves greater than 5% over the last year. In that context, today's move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 10 months ago when the stock gained 17.9% on the news that the company reported strong second-quarter 2024 results, with revenue, active customers, and EPS exceeding Wall Street's expectations. In addition, its EBITDA margin increased year on year, and free cash flow improved. Improved monetization also played a role in the results, as net sales per active customer clocked in at a record $565. Overall, this was an impressive quarter for the company.
Chewy is up 22.6% since the beginning of the year, but at $41.52 per share, it is still trading 13.9% below its 52-week high of $48.21 from June 2025. Investors who bought $1,000 worth of Chewy's shares 5 years ago would now be looking at an investment worth $844.14.
Unless you've been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) semiconductor stock benefiting from the rise of AI. Click here to access our free report on our favorite semiconductor growth story.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
36 minutes ago
- Yahoo
AMD Says New Chips Can Top Nvidia's in Booming AI Chip Field
(Bloomberg) -- Advanced Micro Devices Inc. Chief Executive Officer Lisa Su said her company's latest AI processors can challenge Nvidia Corp. chips in a market she now expects to soar past $500 billion in the next three years. Shuttered NY College Has Alumni Fighting Over Its Future Trump's Military Parade Has Washington Bracing for Tanks and Weaponry NYC Renters Brace for Price Hikes After Broker-Fee Ban Do World's Fairs Still Matter? NY Long Island Rail Service Resumes After Grand Central Fire The new installments in AMD's MI350 chip series are faster than Nvidia counterparts and represent major gains over earlier versions, Su said at a company event Thursday in San Jose, California. The MI355 chips, which started shipping earlier this month, are 35 times faster than predecessors, she said. Though AMD remains a distant second to Nvidia in AI accelerators — the chips that help develop and run artificial intelligence tools — it aims to start catching up with these new products. The stakes are higher than ever: Su previously predicted $500 billion in market revenue by 2028, but she now sees it topping that number. 'People used to think that $500 billion was very large number,' she said in a briefing following her presentation. 'Now it seems well within grasp.' In February, AMD gave a forecast for its data center business that reflected slower growth than some analysts predicted. AMD believes the new update to its MI range will restore momentum and prove it can go toe to toe with a much bigger rival. AMD said that the MI355 outperforms Nvidia's B200 and GB200 products when it comes to running AI software and equals or exceeds them when creating the code. Purchasers will pay significantly less than they would versus Nvidia, AMD said. A representative for Nvidia didn't have an immediate comment. Investors gave a tepid response to AMD's latest presentation, with the shares falling 2.2% to $118.50 at the close Thursday in New York. That wiped out the small gains that the stock made this year. Nvidia and AMD are the leading providers of advanced computer graphics chips, which became the basis of components for developing AI. Demand has consistently outstripped supply as some of the world's largest companies have poured tens of billions of dollars into new infrastructure. That's forced up the price of chips, which can cost multiple tens of thousands of dollars each. For AMD, the accelerator business has helped it escape the shadow of Intel Corp., its longtime rival in personal computer processors. But Nvidia has eclipsed them both. While AMD is getting multiple billions of dollars from its AI accelerators, Nvidia is generating more than $100 billion a year. Su also previewed what's coming next, including the follow-up MI400 series that will hit the market next year. She said the product will achieve clear leadership over the Nvidia chips available at that time. AMD is adding more memory and components that can access information more quickly, an important advantage when running AI software, Su said. OpenAI CEO Sam Altman made an appearance on stage with Su, who explained that the MI400 was designed with input from the AI company's engineers. Altman said that when he'd initially been told about the MI400's proposed specifications, he thought to himself, 'No way.' He said that the demands on computing infrastructure have accelerated this year as the use of AI services has graduated from an amusing curiosity to one with value to businesses. A key question is whether AMD will be able to sell its AI chips more widely. Like Nvidia, the company is restricted from shipping its most powerful components to China under US trade curbs. AMD is lobbying hard to try to get the Trump administration to allow them to freely offer AI components to other countries. A recent deal announced in Saudi Arabia was signed after consulting Washington to make sure that AMD would be allowed to supply the chips, Su said on Thursday. More freedom is needed to make sure that US technology remains central to the development of AI systems worldwide, she said. (Updates with additional CEO commentary starting in fourth paragraph.) American Mid: Hampton Inn's Good-Enough Formula for World Domination New Grads Join Worst Entry-Level Job Market in Years The Spying Scandal Rocking the World of HR Software US Tariffs Threaten to Derail Vietnam's Historic Industrial Boom The SEC Pinned Its Hack on a Few Hapless Day Traders. The Full Story Is Far More Troubling ©2025 Bloomberg L.P.
CNBC
38 minutes ago
- CNBC
Stock futures are little changed as major averages head for winning week: Live updates
Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., June 11, 2025. Brendan McDermid | Reuters U.S. stock futures were little changed on Thursday night as traders prepared to end the week on a positive note. Futures tied to the Dow Jones Industrial Average slipped 58 points, or 0.13%. S&P 500 futures dropped 0.16%, while Nasdaq 100 futures lost 0.15%. In extended trading, home furnishings retailer RH surged 19% after first-quarter adjusted earnings trounced Wall Street's expectations. The company also said it has been shifting sourcing out of China in response to evolving tariff policy. In Thursday's regular session, the 30-stock Dow and the Nasdaq Composite each added 0.2%. The broad market S&P 500, which added nearly 0.4%, is creeping closer to the all-time high reached in February; it's less than 2% off that level. The May reading of the producer price index helped lift the major averages, reflecting a gain of 0.1% from the prior month. That's cooler than the 0.2% increase economists polled by Dow Jones were seeking. Bond yields also eased, lifting investors' sentiment. Earlier this week, the May consumer inflation report also came in cooler than anticipated. Nevertheless, investors' worries over the White House's tariff policy kept a firm lid on market gains. Treasury Secretary Scott Bessent signaled on Wednesday that the Trump administration would be open to extending the current 90-day tariff pause beyond the July 9 deadline for top trading partners – if they show "good faith" in negotiations. However, President Donald Trump raised fears of unilateral tariffs, telling reporters, "We're dealing with Japan, we're dealing with South Korea. We're dealing with a lot of them. So we're going to be sending letters out, in about a week and a half, two weeks, to countries, telling them what the deal is, like I did with EU." Stocks are on track for solid gains thus far this week, with the S&P 500 up nearly 0.8% and the Nasdaq Composite on pace for a 0.7% advance. The Dow is tracking for a 0.5% increase. All three are on pace for their third consecutive positive week. On the economic front, investors will be waiting for the preliminary June reading of the University of Michigan's consumer sentiment report.
Yahoo
38 minutes ago
- Yahoo
Forever Dividend Stocks: 5 Income Stocks I Plan to Never Sell
Brookfield Infrastructure and Brookfield Renewable plan to increase their dividends by 5% to 9% each year. Realty Income has raised its dividend 130 times since coming public 30 years ago. Enterprise Products Partners has increased its distribution for 26 straight years. 10 stocks we like better than Enterprise Products Partners › As I've grown older, I've steadily shifted my investment focus from growth to income. I want to become financially independent. My yardstick will be when my passive income exceeds my basic living expenses. I've built a core income portfolio of companies I believe can supply me with growing dividend income for the rest of my life. Here are five of those forever dividend stocks that I don't plan to ever sell. Brookfield Renewable (NYSE: BEPC)(NYSE: BEP) is a leading global renewable energy producer. It sells the electricity it generates to utilities and large corporate customers primarily under long-term, fixed-rate power purchase agreements (PPA), most linking rates to inflation (70% of its revenue). Those agreements supply Brookfield with stable and growing cash flow to support its dividend, which currently yields over 4.5%. The company has increased its payout at a 6% compound annual rate since 2001. It aims to continue growing its dividend, with a target of 5% to 9% per year. It has multiple growth drivers. Brookfield expects a combination of inflation-linked rate increases, margin enhancement activities, development projects, and acquisitions to power more than 10% annual FFO per share growth over the next decade. Given the growing need for renewable power, I believe the company can continue increasing its dividend for decades to come. Brookfield Infrastructure (NYSE: BIPC) (NYSE: BIP) is the infrastructure-focused sibling of Brookfield Renewable. It operates a globally diversified portfolio of critical infrastructure networks in the utilities, energy midstream, transportation, and data sectors. Roughly 85% of its FFO comes from contracted or regulated assets that either index rates to inflation or protect Brookfield from the impact of inflation. Because of that, the company generates very stable and growing cash flow, which supports its more than 4%-yielding dividend. The company has increased its payout every single year since its formation (16 years), growing it at a 9% compound annual rate. It also aims to raise its payout at a 5% to 9% yearly rate in the future. Growth drivers include inflation-linked rate increases, volume growth as the global economy expands, expansion projects, and acquisitions. Brookfield Infrastructure also expects to deliver 10% annual FFO per-share growth in the coming years to support a rising dividend. Realty Income (NYSE: O) is a leading real estate investment trust (REIT). It owns a diversified portfolio (retail, industrial, gaming, and other properties) net leased to many of the world's leading companies. That lease structure requires that tenants cover all property operating costs, including routine maintenance, real estate taxes, and building insurance. This means that the REIT generates very stable rental income that steadily rises as its long-term leases escalate rental rates. The company has one of the 10 best balance sheets in the REIT sector. That provides it with the financial flexibility to continue expanding its portfolio. It invests several billion dollars in new properties each year. These investments help grow its FFO per share, which allows Realty Income to steadily increase its dividend. The REIT has raised its monthly payout, which yields over 5.5%, 130 times since coming public 30 years ago. Enterprise Products Partners (NYSE: EPD) is a master limited partnership (MLP). It owns an integrated network of energy infrastructure assets, including pipelines, processing plants, storage terminals, and export facilities. Most of its assets generate stable cash flow backed by long-term fee-based contracts or government-regulated rate structures, which support its more than 6.5%-yielding distribution. The MLP has raised its distribution for 26 straight years. That steady growth should continue. The company has one of the strongest financial profiles in the energy midstream industry. That gives it ample financial flexibility to invest in organic expansion projects and make accretive acquisitions. With one of the more diversified platforms in the sector, the company has multiple avenues to grow in the future. Telecom giant Verizon Communications (NYSE: VZ) produces lots of recurring cash flow as customers pay their wireless and internet bills. The company reinvests some of that cash to maintain and expand its networks. It's currently focusing on building faster 5G and fiber networks. Verizon typically has plenty of cash left over to cover its dividend, which yields over 6%. It uses any remaining excess free cash flow, which can be substantial, to strengthen its already rock-solid balance sheet. Its strong balance sheet gives it the flexibility to make acquisitions as opportunities arise, like its pending deal for Frontier Communications to bolster its fiber business. Verizon's investments position it to grow its cash flow in the future. That will give it more room to raise its dividend. Verizon has increased its payout for 18 straight years, the longest current streak in the U.S. telecom sector. I'm building a core income portfolio that will eventually supply me with enough recurring cash flow to cover my basic living expenses. The foundation of that portfolio includes Brookfield Infrastructure, Brookfield Renewable, Enterprise Products Partners, Realty Income, and Verizon. Those five companies produce durable and growing cash flows, which should support sustainable, rising dividend payments. That bankable income is why I plan to hold on to these dividend stocks for the rest of my life. Before you buy stock in Enterprise Products Partners, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Enterprise Products Partners wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $649,102!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $882,344!* Now, it's worth noting Stock Advisor's total average return is 996% — a market-crushing outperformance compared to 174% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 Matt DiLallo has positions in Brookfield Infrastructure, Brookfield Infrastructure Partners, Brookfield Renewable, Brookfield Renewable Partners, Enterprise Products Partners, Realty Income, and Verizon Communications. The Motley Fool has positions in and recommends Realty Income. The Motley Fool recommends Brookfield Infrastructure Partners, Brookfield Renewable, Brookfield Renewable Partners, Enterprise Products Partners, and Verizon Communications. The Motley Fool has a disclosure policy. Forever Dividend Stocks: 5 Income Stocks I Plan to Never Sell was originally published by The Motley Fool Sign in to access your portfolio
