Chewy (CHWY) faces a more muted growth outlook, with softer consumer trends and revised guidance limiting its near-term catalyst path, RBC Capital Markets said in a Thursday note.

The analysts cut their Q2 2026 net sales growth estimate to 6.8% from 8.4%, in line with Chewy's revised guidance of 6% to 7%, while maintaining its adjusted earnings before interest, taxes, depreciation and amortization estimate, citing operating leverage from cost discipline and productivity gains.

The investment firm also reduced its 2026 and 2027 revenue and EBITDA estimates, citing softer demand trends, pressure on premiumization, lower expected active customer growth, and modest cost headwinds from fuel and recent acquisitions.

Despite the softer outlook, the firm pointed to continued margin discipline and efficiency gains, saying Chewy's operating improvements and technology investments are helping offset pressure from a weaker consumer and category environment, the report added.

RBC has an outperform rating on the stock and lowered its price target to $34 from $47.

Shares of Chewy were down more than 5% in Thursday trading.

Price: 18.97, Change: -1.02, Percent Change: -5.08