CHWY Digs For Potential Threats in SEC Fillings

Until now, we have all realized how this is definitely the year of the IPO. Besides that, we also see how it continues. The Chewy has filled its first IPO at the end of April, so we are now finally able to evaluate what can be learned about pet industry valuations which are both coming from trading data and well-known SEC fillings.

Does CHWY has some direct US comparables? It doesn’t, or yet, that is how it may seem in the first place. When we take a look at some other pet food or medicine specialists, we see how this company is the only one that provides such services and offers such quality. But, there are some similarities that provide some of the services as CHWY does.

Earlier, Chewy was often triggered by their so-called competitors like Blue Buffalo and Fresh Pet. Fresh Pet is still trading, but we cannot say the same about Blue Buffalo because General Mills took it over.

How the trades went for General Mills and Fresh Pet? We did research with a purpose to find out about the transactions they had to make. For example, when it comes to General Mills, we are able to say their transactions were always cited in completely fairness opinions. These transactions were related to the pet’s food. But what about the pet’s medicine?

When it comes to pet’s medicine, we need to think about different categories, including pet’s health insurance, hospitals, and pet’s pharmaceutics. Does CHWY has competition there? Well, for health insurance and pharmaceutics there are some companies based in the US that offer such services, yet, when it comes to pet’s hospitals, we weren’t able to see any other transactions than Chewy’s.

And what about Canada? We have discovered only one pet health insurance provider there. Trupanion is the only one that trades publicly.

Who owns Chewy? It is owned by PetSmart. It kept company public until 2015, but now they were taken privately. Should they be worried about their competitors? According to statistics, yes, they should, but only a little bit. We believe how Chewy already has their plan to overcome the possible problems.

Disclaimer: The information on this site is provided for discussion purposes only, and should not be misconstrued as investment advice. Under no circumstances does this information represent a recommendation to buy or sell securities.