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Shares climbed 64% above their IPO price on their first transaction, to $ 36.00 unit, while investors took shares of the online retailer's shares. pet products.
This comes after the company based in Dania Beach, Florida, set Thursday its initial public offering at $ 22 per share, above the upper end of the range of $ 19 to $ 21 per targeted share. Chewy sold 5.6 million shares and a wholly owned subsidiary of PetSmart sold 40.9 million shares, bringing the total to $ 1.02 billion.
The opening stock price of Chewy at $ 36 a piece gave the company a market capitalization of more than $ 14 billion. The stock continued to climb during intraday trading on Friday.
<p class = "web-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Chewy, what & nbsp;it's called& nbsp; "the largest online pet distributor in the United States", addresses a mammoth domestic pet supplies market, a market that has rapidly changed online sales. The US pet industry has achieved an annual business turnover of $ 70 billion in 2017, according to data cited by Chewy. "Data-reactid =" 19 "> Chewy, who himself is referred to as" the largest pure-state pet e-tailer in the United States "," S & 39 address to a sizeable home market for pet products – and a market that has quickly oriented online sales. The US pet industry has achieved an annual business turnover of $ 70 billion in 2017, according to data cited by Chewy.
Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" Chewy derives its income mainly from food, products and products for It offers an autoship service that allows pet parents to automatically reorder products and has increased the subscription program to $ 2.3 billion for fiscal year 2018, up from $ 115 million ago. four years.AMZN) and Walmart (WMT), which also provides consumers with an assortment of pet supplies. "data-reactid =" 20 "> Chewy derives its revenue primarily from the sale of food, pet products and medications.It offers an automatic delivery service allowing pet parents to order again products automatically .Subscription program to 2.3 billion USD for the 2018 fiscal year, up from 115 million four years ago.The company has to face competition from companies such as & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; & nbsp; Amazon (AMZN) and Walmart (WMT), which also provide consumers with an assortment of pet supplies.
Chewy has never made a profit and its net loss is set at $ 267.9 million for the 2018 fiscal year, up from $ 338.1 million for the prior year. At the same time, total sales jumped 67% to $ 3.5 billion in fiscal 2018, outpacing the annual sales of other recently created companies, including Lyft. However, this growth rate has been slower than Chewy's record increase of 134% in fiscal 2017.
Bailey, the rescue dog, poses for a photo in a photo booth before the stock market listing of Chewy Inc. on the New York Stock Exchange (NYSE) in New York, United States, on June 14, 2019. REUTERS / Andrew Kelly
Before stocks began to trade on Friday, some Wall Street investors were already optimistic about Chewy's potential.
"We watched the IPO presentation video and were optimistic about Chewy's growth prospects, motivated by Amazon's focus on the customer experience and the clear winds arising from the growth in the broader pet food and pet care industry, "said Rohit Kulkarni, an analyst at MKM Partners. note Friday.
"Investors are indeed thirsty for an online retailer specializing in online sales and aimed exclusively at consumers' furry friends," added Kulkarni.
Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" More than two-thirds of US households, or about 85 million families have a pet, according to the & nbsp;American Pet Products Association. Expenditures on pet products and services increased at a compound annual growth rate of 5.4% over the five years up to 2017 and are expected to increase by an average of 4.2% annually, from 2017 to 2022, according to Packaged Facts data cited by Chewy. Data-reactid According to the American Pet Products Association, more than two-thirds of US households, or about 85 million families, have a pet.Expenditures on pet products and services have increased at a rate compound annual growth rate of 5.4% by 2017 and is expected to increase CAGR from 2017 to 2022 by 4.2%, according to Chewy's Packaged Facts data.
In 2017, Chewy was acquired by PetSmart for $ 3.35 billion. The private company continues to be a majority shareholder of Chewy. Chewy indicated that PetSmart would own approximately 70% of the total outstanding common shares and approximately 77% of the voting rights following the IPO.
Chewy's IPO was led by Morgan Stanley, JPMorgan Chase and Allen & Co.
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