Whether it be online shopping or social media, secular forces are propelling consumer internet businesses forward. Luckily for them, the market seems to believe there is a long runway for growth
as the industry has recorded a 12.4% gain over the past six months, beating the S&P 500 by 3.5 percentage points.
Shares of e-commerce pet food and supplies retailer Chewy (NYSE:CHWY) jumped 3.2% in the afternoon session after Evercore ISI reiterated its "Outperform" rating on the stock with a $52 price target.
Market swings can be tough to stomach, and volatile stocks often experience exaggerated moves in both directions.
While many thrive during risk-on environments, many also struggle to maintain investor confidence when the ride gets bumpy.
Mid-cap stocks often strike the right balance between having proven business models and market opportunities that can support $100 billion corporations.
However, they face intense competition from scaled industry giants and can be disrupted by new innovative players vying for a slice of the pie.
A number of stocks jumped in the afternoon session after markets continued to rally as the latest inflation data reinforced expectations for a Federal Reserve rate cut as soon as September. The latest Consumer Price Index (CPI) report for July showed inflation holding steady, reinforcing market expectations that the Federal Reserve could begin cutting interest rates as soon as September. Lower interest rates generally stimulate the economy by making borrowing cheaper for consumers and businesses. This can lead to increased consumer spending and e-commerce activity, which directly benefits online retail and marketplace companies. The positive economic outlook fueled a broad-based rally, pushing the S&P 500 and Nasdaq to new record highs and lifting most growth-oriented technology stocks.
Over the past six months, Chewy’s stock price fell to $34.86. Shareholders have lost 6.2% of their capital, which is disappointing considering the S&P 500 has climbed by 5.3%. This may have investors wondering how to approach the situation.
A company that generates cash isn’t automatically a winner.
Some businesses stockpile cash but fail to reinvest wisely, limiting their ability to expand.
GameStop's (NYSE:GME) story is one of unlikely endurance and dramatic transformation, traversing the worlds of brick-and-mortar retail, digital disruption, and the unpredictable dynamics of internet-fueled finance. What began as a small retailer catering to gamers eventually became the epicenter of a financial revolution, illustrating both the vulnerabilities and resilience
Chewy Inc (CHWY) is positioned to benefit from growing Pet Care market, analyst maintains Buy rating with $49 target. CVC rollout and potential for $1bn+ revenue seen.
