Mizuho analyst David Bellinger upgraded Chewy Inc. (NYSE: CHWY) from Neutral to Outperform with a price target of $50.00 (from $44.00).

The analyst comments "We upgrade Chewy (CHWY) to Outperform and raise our PT to $50. Following a pullback off recent highs, we now see the risk / reward for shares tilted heavily upwards. CHWY will be reporting Q2 results on Wednesday morning and updating FY25E guidance in the process. We expect another strong print and positive catalyst, with modest increases to both revenue and adjusted EBITDA guidance. Looking out further, 2H results should alleviate several investor concerns given: 1) Sequentially slower, yet still strong customer growth surpassing +100K net adds each quarter; 2) Core margin weakness fading as initial autoship discounts become less impactful; and 3) Returning to OpEx leverage after front-loading investment spend limited Q1 flow-through. CHWY represents a compelling medium- to long-term opportunity with multiple initiatives at work - including advertising, automation, and building out vet clinics. We see nearly +20% upside for shares."

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Shares of Chewy Inc. closed at $42.33 yesterday.