According to the Futu Securities News app, after Roaring Kitty's dramatic acquisition of 6.6% of Chewy's (CHWY.US) shares, investment bank Evercore ISI conducted its fourth annual US pet survey on the online pet supply retailer and maintained its 'neutral' rating on the company, with a target price of $22.00.

The survey collected opinions from over 600 pet owners and Chewy customers, revealing a continued rise in online pet product purchases, with 85% of respondents indicating that they shop for their pets online, a historic high. Chewy also performed exceptionally well in customer satisfaction, with 87% of respondents expressing their extreme satisfaction with the company.

However, the survey also revealed the challenges facing Chewy: the percentage of consumers choosing Chewy as their online pet supply destination has significantly decreased, dropping from 64% in 2022 to 52%, showing that Chewy faces fierce competition from all channels and value-oriented websites like Walmart (WMT.US) and PetSmart.

These survey results reflect the rapid evolution of the online retail market for pet supplies. While Chewy maintains a high level of customer satisfaction, changes in consumer shopping preferences may affect its market position. The competition from major retailers with strong omnichannel capabilities seems to be a key factor in changing consumer behavior.

Chewy is known for its wide variety of pet products and services and occupies an important position in the online pet retail industry. The company's focus on customer experience and satisfaction has always been the core of its business model. However, in the face of changing market dynamics, Chewy needs to develop new strategies to continue attracting and retaining customers in the fiercely competitive online environment.

Recently, Chewy's business operations have made significant progress. In particular, the disclosure by Keith Gill (also known as 'Roaring Kitty') of his 6.6% stake in Chewy has sparked investor interest and highlighted Gill's influence in the market.

According to holdings information disclosed on the official website of the US Securities and Exchange Commission (SEC), Roaring Kitty owned about 9 million shares of Chewy's Class A stock, with a total value of approximately $245 million at Friday's close. Last week, Gill posted a cartoon image of a dog on social media, which briefly drove up the stock prices of Chewy and Petco Health and Wellness (WOOF.US). Data shows that Chewy's stock price has risen by about 70% since early May, but is still down 79% from its peak in 2021.

It is worth mentioning that Gill, who once drove the 'retail investor war against Wall Street' and sparked the frenzy for GameStop (GME.US) stock, returned to social media in May and triggered a rally in a number of meme stocks, including GameStop. GameStop quickly took advantage of this and raised more than $3 billion in stock issuance on the market. However, Gill was sued by federal prosecutors for allegedly planning a scheme to drive up and sell GameStop stock in Brooklyn, New York last Friday.

At the same time, the market's interest in Chewy's short position is also on the rise, a phenomenon that is not uncommon among meme stocks, including GameStop. More noteworthy is the connection between GameStop and Chewy. Ryan Cohen, GameStop's CEO, is also Chewy's founder and CEO. He led PetSmart's acquisition of Chewy in 2017 and pushed for Chewy's initial public offering (IPO) in 2019.

Chewy has also taken strategic share buyback measures, planning to repurchase 17,550,000 shares of Class A common stock, demonstrating the company's confidence in its growth strategy and profit margin expansion. This repurchase is part of Chewy's capital allocation strategy and is expected to be completed on June 27, 2024.

In terms of analyst ratings, Jefferies raised Chewy's target price to $31 and maintained a 'buy' rating. Barclays reiterated its 'hold' rating, with a target price of $32. Mizuho Securities also raised Chewy's target price to $20, considering the company's share buyback plan.

In terms of financial performance, Chewy performed strongly in the first quarter of 2024, with Autoship sales growing, gross margins and EBITDA profit margins both reaching historical highs. Despite a slight decline in active customer numbers, Chewy expects second-quarter revenue to meet Wall Street's expectations. The company also reaffirmed its full-year 2024 revenue guidance and raised its 2024 EBITDA profit margin guidance, with the midpoint increasing from 3.8% to 4.2%.

Mark Mahaney, an analyst at Evercore ISI, also said: "Despite the industry slump, we still believe that Chewy is a stable company with many investment highlights -- including continued growth in each customer's spending and loyalty, advertising sponsorship, international expansion, growth opportunities in vertical areas such as veterinary clinics, and potential for continuous improvement in gross margin and EBITDA profitability. "

After experiencing a series of fluctuations related to Gill, Chewy's stock price fell slightly by 0.30% in pre-market trading on Tuesday. After a period of intense volatility, Chewy's stock price has risen nearly 15% in the past six weeks. Currently, short positions on Chewy account for 14.9% of its total outstanding shares, displaying the market's diverging views on its prospects.