Options traders are betting on a rebound for Chewy Inc ahead of its September 9 earnings report, with call volume outpacing puts by nearly nine-to-one on August 28. The pet e-commerce company’s stock, trading at $23.37, has fallen 45% over the past year but gained 2.5% on the day, reflecting heightened interest in near-term upside bets.
Call options dominated trading, with 19,686 contracts exchanged against just 2,144 put contracts. The most active January 2027 $47.50 call saw 5,353 contracts traded, more than 20 times its open interest, while near-term call spreads for September 18 ($22.50/$27.50 and $25/$30) accounted for thousands of additional contracts. Open interest was concentrated at the $22.50, $25, and $27.50 strikes, signaling expectations of a move toward those levels.
Implied volatility for Chewy’s options dipped slightly to 54.15%, down 0.78 percentage points, while the 90/110 volatility skew rose to 1.47 points, indicating increased demand for out-of-the-money calls relative to puts. The skew shift suggests traders are pricing in a higher probability of an upward move following the earnings release.
Analysts remain divided on Chewy’s prospects, with a mean price target of $30.55 implying roughly 30% upside from current levels. The highest target stands at $40, while the lowest is $22. Consensus remains a Strong Buy, with a rating of 1.77 out of 5. Recent adjustments include Morgan Stanley cutting its target to $37 from a prior level, Piper Sandler reaffirming its $30 target, and Rosenblatt initiating coverage with a Neutral rating and a $25 target.
Street estimates for the September 9 earnings call project earnings per share of $0.18 on revenue of $3.32 billion. The options market’s positioning, combined with mixed analyst outlooks, underscores uncertainty about whether Chewy can reverse its recent underperformance.
