TD Cowen Names Chewy (CHWY) Its Top Smid-Cap Stock Idea for 2026
TD Cowen Names Chewy (CHWY) Its Top Smid-Cap Stock Idea for 2026.
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Chewy, Inc. (NYSE: CHWY ) is one of the best stocks to invest in according to Two Sigma Advisors with huge upside potential . On June 23, TD Cowen analyst William Kerr named Chewy, Inc. (NYSE:CHWY) as the firm's best small- and mid-cap, or Smid-cap, stock idea for 2026, and at the same time reiterated a Buy rating and a $34 price target on the shares.
Kerr said his firm's endorsement was built around several growth and margin levers it believes Chewy has not yet fully monetized. These include its veterinary care partnership through CVC and Modern Animal, an expanding advertising business, ongoing automation of its fulfillment operations, the Chewy+ membership program, and the integration of generative AI into its platform.
Kerr added that at the time of the note, Chewy was trading at just 6.3 times its enterprise value-to-EBITDA. He described this valuation as attractive given the company's expected EBITDA compound annual growth rate of 15% over the next five years. Put simply, the analyst believes the stock is too cheap relative to how fast the business is expected to grow.
The analyst also pointed out that as online shopping for pet products continues to grow as a share of total industry sales, Chewy is well positioned to pull customers away from physical competitors. The competitors include local pet stores, traditional retailers, and grocery chains.
The Smid-cap designation places Chewy in a curated list of TD Cowen's top investment picks for companies with a market capitalization generally below $10 billion. This is the firm's annual selection that signals its highest-conviction ideas in that size category.
Chewy, Inc. (NYSE:CHWY) is an online retailer of pet products. It operates an e-commerce platform offering pet food, treats, supplies, and pharmacy services, with a focus on subscription-based auto-ship deliveries.
While we acknowledge the potential of CHWY as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock .
READ NEXT: Billionaire Cliff Asness' Top 10 Healthcare Stock Picks and 10 Best Stocks to Buy Now for Good Returns .
Sinergia Empresarial continuará el seguimiento de esta información sobre tD Cowen Names Chewy (CHWY) Its Top Smid-Cap Stock Idea for 2026 y ampliará la cobertura conforme se confirmen nuevos elementos relevantes para el ecosistema empresarial.
