CHWY heads into its August 26 earnings report with a stock that has quietly recovered 17% over the past month, even as short sellers have been quietly retreating — a combination that sets up an interesting test of whether the improvement is real or just relief.
The short-side story has turned notably less aggressive. Short interest has dropped from a peak of around 31 million shares in late July to roughly 24 million, now representing about 10.7% of the free float — still elevated, but moving in the right direction for bulls. The borrow market reflects no stress: cost to borrow is just 0.52%, and availability is deep at 626%, meaning there is ample room for new shorts if sentiment sours after the print. The ORTEX short score has also eased from 58.3 to 55.3 over the past two weeks, consistent with the unwinding trend. Options positioning adds little drama — the put/call ratio of 0.69 is almost exactly in line with its 20-day average, implying no unusual hedging activity ahead of the release.
The analyst community is broadly cautious but not abandoning the name. Rosenblatt initiated coverage with a Neutral rating and a $25 target just days ago, essentially stamping the current price as fair value. The broader consensus leans hold, with a mean target of $30.77 — implying roughly 25% upside from $24.50, though that target has been under pressure since June, when Goldman Sachs, JPMorgan, Barclays, RBC, and others all trimmed targets following the prior quarter's disappointing guidance. Goldman retained its Buy but cut from $46 to $34, a signal that conviction has softened even among the bulls. The bull case rests on new revenue streams — a retail media network and veterinary clinics — that could eventually expand margins beyond what the core e-commerce business delivers. Bears point to a lowered revenue outlook, rising competition in pet e-commerce, and a recent pattern of insider selling: CEO Sumit Singh sold nearly $1.65 million in stock across two transactions in late July and early August, joined by the CFO and Chief Accounting Officer in coordinated sales on July 31.
That insider selling pattern is worth noting, though the significance is tempered by the modest trade-significance scores (rated 1-2 out of 10 by ORTEX). The last earnings print in June delivered a rough outcome — the stock fell nearly 8% on the day and lost close to 13% over the following five trading sessions. The more recent July event saw a mild 1.6% gain on the day and a 4.7% five-day lift, but those two events paint a mixed picture of how the market has processed Chewy's results in 2026.
Wednesday's print is therefore less about Chewy's long-term positioning in pet e-commerce and more about whether the company can deliver revenue and margin figures that justify a stock already up 17% in a month, in the face of analysts who have spent the summer cutting their targets.
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