CHWY heads into its Q1 2026 earnings report on July 9 with short sellers pressing their bets and options traders tilting toward calls — a split that makes the positioning story genuinely interesting.
The bearish conviction is visible in the short book. Short interest has climbed to 12.3% of the free float, up 6.3% on the week and 2.7% over the past month, reaching roughly 27.8 million shares. That is a meaningful and growing position. Yet the borrow market tells a different story: availability is loose — 643% relative to shares already borrowed — meaning there is roughly six times more stock available to lend than is currently out on loan. Cost to borrow has also eased, falling 14% on the week to under 0.4%. The shorts are building, but the lending conditions suggest no squeeze pressure is imminent.
Options traders are not confirming the bearish thesis. The put/call ratio has dropped to 0.59, well below its 20-day average of 0.67 and near the more bullish end of its one-year range. That makes the current posture about one standard deviation lighter on hedging than usual — unusual heading into a print where the stock has a recent history of punishing misses. The last earnings release, in June, sent CHWY down 8% on the day and nearly 13% over the following five sessions.
The analyst community spent much of June recalibrating. Following that June print, Goldman Sachs cut its target from $46 to $34 while holding its Buy rating, and JP Morgan trimmed from $35 to $29 while staying Overweight. The direction was uniform — almost every firm lowered targets — but most kept positive ratings. The consensus mean target now sits around $31, about 50% above the current price of $20.73, suggesting the Street still sees recovery potential but has meaningfully marked down its near-term assumptions. Bulls lean on Chewy's Autoship loyalty base and its push into veterinary clinics as durable revenue streams. Bears focus on slowing pet e-commerce growth, margin pressure, and mounting competition from larger platforms eroding the delivery advantage that long differentiated Chewy.
The institutional register adds one complicating layer: PetSmart and BC Partners together control around 86% of shares, leaving a thin public float that amplifies moves in either direction. BlackRock added roughly 1.5 million shares through June, while AQR built a meaningful position in Q1. The overall picture is one of strategic holders sitting still while tactical money takes opposing sides.
The July 9 print tests whether Chewy's Autoship momentum and any early signs from its clinic rollout can offset what the Street has already priced in as a structurally tougher operating environment.
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