Investors are closely comparing Chewy (NYSE: CHWY) and Walmart (NASDAQ: WMT) as both companies expand their digital and physical retail ecosystems in 2026.
Chewy has built its reputation as the dominant online pet retailer in the U.S. and Canada, serving approximately 21.3 million active customers with a high-touch service model.
The company maintains an extensive network of roughly 20,000 veterinary practice partners, and its April 2026 acquisition of Modern Animal added physical veterinary clinics to its platform.
In the fiscal year ended February 1, 2026, Chewy reported revenue of nearly $12.6 billion, representing year-over-year growth of approximately 6.2%.
The company posted net income of close to $222.8 million for that period, translating to a net margin of roughly 1.8% while continuing to invest in expansion.
Chewy generated nearly $562.4 million in free cash flow during the fiscal year, though stock-based compensation represented roughly 43.1% of operating cash flow.
Walmart operates an entirely different scale, serving nearly 280 million customers weekly across 19 countries through its massive omnichannel retail model.
In the fiscal year ended January 31, 2026, Walmart posted revenue of roughly $713.2 billion, a 4.7% increase over the prior fiscal year, with net income of close to $21.9 billion.
The company generated roughly $14.9 billion in free cash flow for the period, providing substantial capital for dividends and ongoing growth investments.
Walmart’s debt-to-equity ratio stands at approximately 0.7x, meaning total debt remains lower than shareholder equity, reflecting a relatively conservative financial position.
Chewy’s autoship program drives the majority of its revenue through recurring purchases of food, cat litter, flea treatments, and other pet necessities that customers order on a regular schedule.
Chewy has also expanded into veterinary medications and physical veterinary care locations, though discretionary pet spending has softened and competition in the autoship space has increased.
Walmart continues to diversify its revenue streams beyond traditional retail, including growing its advertising business following its acquisition of Vizio and leveraging proprietary customer data.
From a valuation standpoint, Chewy carries a Forward P/E of 26.6x and a P/S ratio of 0.7x, compared to Walmart’s Forward P/E of 39.6x and P/S ratio of 1.3x.
Both companies face distinct risk profiles, with Chewy exposed to cybersecurity vulnerabilities and significant voting control held by BCP Partners, while Walmart navigates regulatory scrutiny and sensitivity to global inflation.
Walmart’s enormous store network, diversified product offerings, e-commerce platform for third-party sellers, and long track record of consecutive annual dividend increases make it the preferred pick for long-term investors seeking steady earnings growth.
