Can Chewy Become a 10-Bagger Stock Like Its Predecessors?
Peter Lynch was one of the most successful investors in his time, achieving a 29.2% average annual return between 1977 and 1990 with his Magellan fund.
Lynch's formula for picking 10-bagger stocks involved looking for companies that met certain criteria, including being 'boring' but having competitive advantages.
Chewy (CHWY) may fit this mold as a retail stock with a higher level of customer service than Amazon, offering 24/7 representatives and handwritten cards when pets pass away.
The company's pet services ecosystem includes telehealth services for pets and physical vet clinics in select areas.
Despite the pandemic, Chewy grew its sales by 7% in Q1 of fiscal 2026 and increased net income by 51%, meeting Lynch's minimum growth rate of 20%.
The stock trades at a discount of more than 80% from its all-time high during the pandemic, making it a potential mid-cap stock with room for growth.