Chewy vs Walmart Which Is a Smarter Choice?

Investors seeking exposure to the e-commerce space may be considering Chewy Inc. and Walmart Inc. as potential investment opportunities. Chewy, a specialized online retailer of pet products, has seen steady growth due to the increasing popularity of pet ownership. On the other hand, Walmart, a retail giant with a strong online presence, offers a wide range of products beyond just pet supplies. Both companies have their own strengths and weaknesses, making them interesting choices for investors looking for exposure to the e-commerce sector.

Chewy or Walmart?

When comparing Chewy and Walmart, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Chewy and Walmart.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Chewy has a dividend yield of -%, while Walmart has a dividend yield of 0.96%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Chewy reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, Walmart reports a 5-year dividend growth of 1.85% year and a payout ratio of 41.18%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Chewy P/E ratio at 39.49 and Walmart's P/E ratio at 43.56. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Chewy P/B ratio is 29.57 while Walmart's P/B ratio is 8.02.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Chewy has seen a 5-year revenue growth of 1.89%, while Walmart's is 0.34%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Chewy's ROE at 71.71% and Walmart's ROE at 18.91%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $31.29 for Chewy and $84.12 for Walmart. Over the past year, Chewy's prices ranged from $14.69 to $39.10, with a yearly change of 166.26%. Walmart's prices fluctuated between $49.85 and $85.54, with a yearly change of 71.61%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.