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PetSmart’s Chewy Share Price Soar 86% Post IPO Debut

Online pet product retailer Chewy which is owned by behemoth PetSmart that made its public debut this Friday witnessed smart uptick on opening day and soared by nearly 86 %. On its first trading day the share opened at $36 giving it market capitalization of $14.9 billion and closed the day at $34.99 per share which is 59 % higher than its IPO price. When it opened the 46 million shares of Chewy were priced at $22 per share which was a little over its indicative range of $19. The stock offered exceeded expectations by $5 million and helped raise $1 billion.

Chewy was founded in 2011 by Michael Day and Ryan Cohen which brands itself as largest pet-e-tailer within United States. It has set itself apart from other similar businesses in the market by excellent customer service which is accessible 24/7 and delivers all online orders within two days. This has helped it to establish loyal customer base that has grown at a rate of 60 % that contributed $3.5 billion in sales and helped to attract investors to its IPO. CEO Sumit Singh of Chewy stated that from online point of view the brand’s reach is just 10 % of the $70 billion pet food industry and the online industry has penetrated just 14 % of it.

Though on a high growth path the firm has faced several challenges like high shipping costs that have eaten into its profits and between 2017 and 2018 it reported net loss of $268 million. But its sales have been growing rapidly climbing from $26 million during 2012 to nearly $3.5 billion during 2018. After the IPO, parent PetSmart backed by BC Partners will own around 70 % of Chewy’s stock and will have 77 % voting power which it had acquired in 2017 for 3 billion.

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Joyce Lattimer

With a background of M.Sc. in Space Studies, Joyce Lattimer sought to enhance her writing skills relating to Science articles. From being a naïve freelancer to a full-fledged Content Writer, Joyce has placed a firm foot in our organization. She has taken on the accountability of writing articles and blogs about the Science world that comprise, but not limited to, liftoff schedules, updates, launches, research, and so on. She also tutor kids anything relating to the field of Science.

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