10 Stocks That Analysts Are Talking About

2. Chewy Inc. (NYSE:CHWY)

Chewy is a purely online retailer of pet food & treats, pet health products, pet medications & supplies, and also offers pet services for horses, dogs, birds, reptiles, and other pets. Argus just upgraded CHWY from Hold to Buy, assigning a target price of $42.

Chewy has done incredibly well since its IPO in 2019. The company has an attractive business model which gives it its inherent value. For example, 85% of the company’s revenue comes from pet products and services that are considered non-discretionary. Similarly, 80% of its revenue is in the form of recurring sales, which provides it with a healthy cash flow and a predictable income.

The recent initiative of the company to launch vet care centers is also a high-margin business segment and should strengthen the company’s financial health. Shares of CHWY are already up over 13% so far this year and have nearly doubled in a year.