CHWY has just printed its June 10 earnings and the positioning heading into that report tells a clear story — short sellers built aggressively over the past month and options traders followed them toward caution.
Short interest came into the print at 12.1% of the free float, up 41% over the past month from roughly 8.6% at the end of April. That is a sustained, deliberate build — not noise. The ORTEX short score edged back to 54.9 after peaking at 58.8 on May 27, the day of the prior quarterly print. Bears trimmed slightly in late May then rebuilt: shares short rose 3.5% on June 9 alone to 27.2 million. What has not changed is the absence of squeeze pressure. Borrow availability remains exceptionally wide at 836% of short interest — more than eight shares available to lend for every one already borrowed. Cost to borrow is just 0.50%, up roughly 18% on the week but still near its annual floor. The lending market is loose, and there is no structural friction forcing existing shorts to cover.
Options positioning shifted more noticeably. The put/call ratio jumped to 0.89 on June 9, well above its 20-day average of 0.72 and about 1.4 standard deviations above that mean — the most defensive reading in the past month. Earlier in May the PCR was running below 0.50; the steady climb toward 0.89 reflects a market that gradually priced in downside risk ahead of the report. The 52-week high is 1.06, so there is room to go further, but the directional shift is real.
The Street's posture reinforces the caution. Every recent analyst action has been a target cut. JP Morgan, Morgan Stanley, Barclays, Mizuho, and Citigroup all trimmed targets in May and early June — yet every one of them held their positive ratings (Overweight, Outperform, or Buy). The mean price target lands near $37.70 against a closing price of $20.40, implying roughly 85% theoretical upside. That gap is striking. Bulls point to Chewy's autoship subscription model, expanding veterinary services, and sponsored-ad revenue as durable margin drivers. Bears counter with mounting competitive pressure from Amazon and Walmart, supply-chain fragility, and the risk that new customer conversion rates disappoint as the post-pandemic pet boom fades. The forward EPS growth score ranks in the 87th percentile, a genuine fundamental positive — but the short score rank sits in the 19th percentile, meaning the stock screens as more short-pressured than most of its universe.
Institutional data adds one angle worth noting. AQR added 5.1 million shares in Q1, Two Sigma added 3.6 million, and both Vanguard entities appear to have initiated positions. Against that, Holocene trimmed by 2.7 million. Insider activity over the past 90 days has been uniformly one-directional: every disclosed trade has been a sale, including a $2.1 million disposal by CEO Sumit Singh on May 4. The trades carry low significance scores and are likely plan-driven, but the direction is consistent.
The next focal point is the July 9 earnings event — the setup heading into that print will depend heavily on how the market absorbs today's June 10 results, and whether the month-long short build accelerates or begins to unwind in response.
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