Stories are generated from ORTEX data and reviewed by the ORTEX team. How we publish
CHWY enters the final stretch before its December 2 earnings report with a curious split in its positioning signals: short sellers have been quietly trimming exposure while options traders have become meaningfully more defensive than they were a month ago.
Short interest has pulled back from its September peak but remains high in absolute terms. At 10.1% of free float, the short position is still substantial, and the month-on-month picture shows it is 11.7% larger than it was 30 days ago. The week itself brought some relief for longs: short shares fell roughly 2% over the past five days to around 22.7 million. The lending market gives no sign of stress on either side. Borrowing costs have ticked up 16.9% over the week to 0.41%, but that is still near the bottom of any sensible scale. Availability of shares to borrow is extremely loose at 445%, meaning there are more than four shares available to lend for every one currently borrowed. That combination, high short interest with abundant and cheap borrow, describes a stock where bears are present but not under pressure.
Options positioning tells a different story. Put demand has risen sharply relative to calls: the put/call ratio of 0.82 is roughly one standard deviation above its 20-day average of 0.74, and the trend since early September has been one-directional. Through August and the first weeks of September the PCR sat consistently below 0.70; it has not touched that level since September 21. The 52-week high is 1.06, so the current reading is elevated but not extreme. Still, the direction of travel is clear: options buyers are hedging more aggressively as the stock has slid 23% over the past month to $18.22.
The Street absorbed September's weak print with a uniform response: every major firm cut its target while keeping positive ratings intact, a posture that signals continued fundamental confidence paired with valuation discipline. Goldman Sachs cut to $30 from $34, Morgan Stanley trimmed to $36 from $37, and JP Morgan went further, downgrading to Neutral with a $24 target from an Overweight at $29. Mizuho followed at the end of September, lowering to $28. The mean target now sits near $28.64, implying roughly 57% above the current price, a gap that reflects either Street optimism or how far the stock has fallen from prior consensus levels. Valuation multiples have compressed sharply: the PE ratio is down 3.2 points over the past 30 days to around 10.2x. EV/EBITDA at 6.8x is near the low end of where the stock has historically traded. The ORTEX short score of 57.3 ranks in the 18th percentile for short positioning intensity, suggesting bears are present but this is far from a crowded short.
The alt-data layer does surface one noteworthy fact. CHWY's buyback spend in Q2 2026 came to $200 million, a 766% increase on the same quarter a year earlier and the largest Q2 buyback on record since 2024, per EDGAR XBRL filings published by the SEC. That level of capital return is notable context against the bear case around free cash flow pressures. None of the three available datasets, Wikipedia views, buybacks, and WARN notices, has been measured as a leading indicator for Chewy's reported financials, so the buyback figure is corporate behaviour data rather than a signal about the next revenue print.
The ownership picture is dominated by a structural overhang: BC Partners holds around 43% of shares and PetSmart LLC holds a near-identical stake, together accounting for roughly 88% of the company. Canada Pension Plan Investment Board disclosed a new position of 5% with a first filing in August 2026, adding 14.9 million shares. BlackRock also expanded its position modestly. Wellington, Baillie Gifford, and Viking Global have all reduced materially or exited entirely based on their most recent disclosures, though those positions are as-last-filed and may have changed further since. No 13D activist is on the register.
Earnings history sharpens what is at stake on December 2. The September 9 Q2 print produced a one-day fall of 9.4% and a five-day fall of 10.1%. The August 2025 print moved the stock down 7.7% in a day. Two consecutive post-earnings declines of that magnitude, both on results that showed improving margins and accelerating revenue growth, point to a market that is using any print as an opportunity to reduce exposure rather than add it. The next print covers a period where the bull case rests on whether Chewy's higher-margin businesses, pharmacy, telehealth, advertising, vet clinics, are beginning to move the needle on EBITDA margins beyond the 6.8% guided for FY26.
The key variable to watch into December is whether short interest, which peaked in mid-September near 26.5 million shares and has since retreated, continues to unwind or rebuilds if the stock cannot recover the ground lost over the past month.
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 and reviewed by the ORTEX team. Content is informational only and does not constitute investment advice.
