Shares of pet e-commerce company Chewy (NYSE:CHWY) spiked higher on Wednesday after an analyst raised the stock’s price target. As of 2:45 p.m. EST, Chewy stock was up 9% on this news and has now rallied a mind-blowing 450% from 52-week lows.
According to The Fly, a Credit Suisse analyst had previously assigned Chewy stock a price target of $104 per share. However, the stock’s price target was raised today to $121 per share. Considering Chewy stock traded around $104 per share at yesterday’s close, the updated price target implies 16% upside.
Chewy’s $121 per share price target is the most bullish opinion among Wall Street analysts tracked by TipRanks. However, investors should keep in mind that analysts are just people like you and me. Their opinions are very well informed, but they can prove to be right or wrong in time. More importantly, analysts tend to periodically update their price targets. Now that Credit Suisse has raised its price target, it’s possible other analysts could soon follow. So $121 per share might not be the highest price target for long.
Investors should also remember not all news is actionable, and I’d say that’s the case here with analyst price targets. It’s valuable to understand why these analysts are bullish regarding Chewy’s opportunity. But this is only so you can better understand the big picture: how Chewy can grow its business, gain market share, and reward shareholders. Updated price targets tend to only move stocks in the short term. Chewy’s business will move the stock in the long term, making it the more important thing to focus on.