"Roaring Kitty" makes $245 million bet on Chewy Inc, benefiting from subscription plan and target market

From Investing.com: 2024-07-01 13:21:13

Keith Gill, known as the meme stock trader “Roaring Kitty,” has made a $245 million bet on Chewy Inc, an $11 billion e-commerce retailer specializing in pet products. Their subscription plan and narrow target market have helped boost revenue and profit margins.

Chewy, founded in 2011 and acquired by PetSmart in 2017, offers 115,000 pet products to U.S. customers. The company reported net sales of $11.15 billion for the fiscal year ending Jan. 28, 2024. Chewy’s shares peaked in early 2021 due to increased pet ownership during the pandemic.

Gill’s interest in Chewy is partly influenced by the fact that GameStop’s CEO Ryan Cohen founded the company. Gill has acquired a 6.6% stake in Chewy, making him the third-largest shareholder. His Reddit posts about GameStop led to a 700% increase in the retailer’s shares in 2021.

Chewy’s stock has been volatile recently, with a 13% loss in value since Gill’s social media post about the company’s logo. The stock is highly shorted, with 15.7% of its free-float shares in short position as of June 27. Comparatively, only 0.9% of Amazon’s free float shares are shorted.



Read more at Investing.com: Factbox-What is Chewy, the pet products website ‘Roaring Kitty’ is championing? By Reuters