Chewy Stock Muted Ahead of Earnings

The equity has a history of moving lower after earnings

Deputy Editor
Aug 31, 2021 at 12:54 PM
facebook twitter linkedin

Online pet supply retailer Chewy Inc (NYSE:CHWY) is gearing up for its second-quarter earnings report, due out after the close tomorrow, Sept. 1. Analysts expect Chewy to report a loss of 2 cents per share, and forecast a 29.3% rise in revenue from a year ago. Below, we'll take a look at the equity's chart performance ahead the event, and dig into Chewy's history of movement after earnings.

Chewy stock continues to rebound from its May 13 six-month low of $64.08, though its rally was cut short after being rejected by the $98 level earlier this month. The dip was saved by the 150-day moving average, a new trendline of support that previously had put pressure on the shares in mid April. Today, CHWY is relatively muted, down a paltry 0.8% to trade at $89.35, and remains just 0.7% below its year-to-date breakeven mark. 

CHWY Chart 2 August 31

Looking back at the company's last eight reports, Chewy stock has suffered six negative next-day returns, including a 5.8% dip after its most recent report in June. CHWY has averaged a post-earnings swing of 5.7%, regardless of direction, and this time around the options pits are pricing in a much bigger move of 11.8% for Thursday's trading. 

A short squeeze could put wind under Chewy stock's sails. Currently, short interest makes up a healthy 17.2% of the stock's total available float, and it would take nearly a week for shorts to buy back these bearish bets. 


Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 



Special Offers from Schaeffer's Trading Partners