Chewy (NYSE: CHWY) inventory discovered itself within the doghouse on Thursday. Shares fell 6% by early afternoon buying and selling, in comparison with a modest uptick within the S&P 500. That transfer contributed to a tough yr for house owners of the pet provide retailer, which is down over 50% previously 12 months.Thursday’s hunch was sparked by some discouraging information on the earnings entrance .Barking up the incorrect treeChewy executives reported This autumn working outcomes earlier than the market opened, and Wall Avenue wasn’t thrilled with the main points. Whereas the e-commerce specialist boosted gross sales and improved its revenue margin, each metrics have been sluggish. Wanting deeper into the outcomes reveals some warning indicators for the long run.Particularly, Chewy continued to shed clients. Its energetic shopper pool fell 1.6% for the yr to mark an acceleration over the prior yr’s 1.2% drop. The corporate offset that strain by elevating costs and transferring barely larger quantity by its supply community. But it was nonetheless discouraging to be taught that Chewy is not any nearer to logging a rebound in its core active-customer metric.Wanting aheadManagement mentioned they have been as excited as ever about Chewy’s long-term development initiatives, which embody its push into pet healthcare and entry into the Canadian market. The enterprise is worthwhile and cash-flow constructive, in spite of everything, and its e-commerce customers stay extremely engaged with the platform.Sadly, the following yr can be characterised by an excellent more durable promoting atmosphere. Costs will not rise like they did in 2023, administration warned, as a result of inflation has cooled. Volumes will doubtless be pressured as a result of pet adoption charges are down. Total, there’s little cause to be excited a couple of development rebound occurring within the subsequent yr or so.These projections do not imply it is time to abandon Chewy’s inventory. However they do recommend that its enterprise will wrestle by at the very least another yr of unusually weak outcomes because the pandemic-growth hangover continues pressuring the pet provide business.Story continuesShould you make investments $1,000 in Chewy proper now?Before you purchase inventory in Chewy, contemplate this:The Motley Idiot Inventory Advisor analyst staff simply recognized what they imagine are the 10 greatest shares for traders to purchase now… and Chewy wasn’t considered one of them. The ten shares that made the reduce may produce monster returns within the coming years.Inventory Advisor supplies traders with an easy-to-follow blueprint for fulfillment, together with steerage on constructing a portfolio, common updates from analysts, and two new inventory picks every month. The Inventory Advisor service has greater than tripled the return of S&P 500 since 2002*.See the ten shares*Inventory Advisor returns as of March 21, 2024Demitri Kalogeropoulos has no place in any of the shares talked about. The Motley Idiot has positions in and recommends Chewy. The Motley Idiot has a disclosure coverage.Why Chewy Inventory Dropped on Thursday was initially revealed by The Motley Idiot