CHWY enters Tuesday's September 9 print with shorts rebuilding, analysts divided, and the options market leaning in the opposite direction — a three-way split that makes the setup harder to read than the numbers alone suggest.
The short position rebuild is the dominant market structure story right now. Short interest has climbed 13% on the week to 21.7 million shares, back to 9.6% of the free float, after touching a post-earnings trough near 19 million last week. That unwind-then-reload pattern is worth noting: bears covered decisively after the August 26 print sent the stock down 7.7%, then turned around and added back within days. The borrow market shows no sign of stress driving the move. Cost to borrow is running near 0.46% — trivially cheap — and availability at 544% means roughly five shares are sitting available to lend for every one currently out on loan. This is a deliberate, unconstrained rebuild, not a short squeeze reversal or forced activity.
Options traders are reading the situation differently. The put/call ratio at 0.66 is running a standard deviation and a half below its 20-day average of 0.69, marking the most call-skewed reading in the recent window. That tilt toward calls — even as shorts add — is a genuine divergence. The 52-week PCR range runs from 0.40 to 1.06, so neither extreme has been reached, but the current lean is notable given that the last earnings print wiped 7.7% off the stock in a single session and the five-day follow-through extended to nearly -2%.
The analyst community is also split, and that split sharpened on the day the earnings note publishes. Raymond James raised its target from $25 to $28 while maintaining Outperform. Mizuho simultaneously cut its target from $40 to $32, also keeping an Outperform rating. Morgan Stanley trimmed its target from $42 to $37 following the August 26 results, remaining Overweight. The mean target of $30.32 sits roughly 28% above the current $23.66 — implying the Street broadly believes the stock is cheap here — but the direction of recent moves is clearly downward. Most of the June cluster of target cuts came off $35–$47 levels. Rosenblatt initiated in August at Neutral with a $25 target, flagging macro headwinds and softer premiumization trends as near-term constraints. The bull case rests on autoship loyalty and the veterinary clinic expansion; the bear case is simpler — discretionary spending is softening and Amazon and Walmart are not standing still.
The ORTEX short score has drifted steadily higher through the week, reaching 55.7 — not extreme, but rising. The twelve-month forward EPS growth factor ranks in the 88th percentile, suggesting the earnings recovery narrative still has genuine analytical support even as near-term momentum remains weak. The stock is down roughly 1.3% on the day and off 1.8% for the month, though it recovered 1.7% on the week. The earnings history adds context without comfort: the two most recent prints produced single-day moves of -7.7% and -8.0%, with the latter compounding to a -12.9% five-day loss. The one exception in recent history was a July print that generated a +1.6% one-day gain and a +4.7% five-day move — showing the distribution is genuinely bimodal rather than persistently negative.
With the September 9 report four days out, the question is whether the short rebuild reflects a directional view on the print itself or a hedge against a pattern of post-earnings volatility that has been severe in two of the last three quarters. The divergence between shorts adding and options tilting call-heavy is the tension worth tracking into Tuesday.
See the live data behind this article on ORTEX.
Open CHWY on ORTEX →ORTEX Market Intelligence content is generated by AI from a snapshot of ORTEX's proprietary data. Content is informational only and does not constitute investment advice.
