Chewy vs. Walmart: Which Consumer Stock Is a Better Buy in 2026?

A Tale of Two Retailers

Chewy and Walmart are two vastly different companies operating in the retail space. Chewy is a leader in the online pet market, with a high-touch customer service model and subscription-based revenue. On the other hand, Walmart is a diversified retail giant with a massive physical footprint and growing e-commerce capabilities.

Chewy's business model revolves around consumers' devotion to their pets. Its autoship program generates the majority of its revenue through recurring sales of necessary items such as food and supplies. The company has a strong network of partners, including roughly 20,000 veterinary practices, which helps it to expand its reach and offer a wider range of products.

In contrast, Walmart's business model is built around its massive scale and consumer convenience. The company sells everything from home goods to tools and groceries, and it even offers oil changes. Its scale and consumer convenience position it to deliver steady earnings growth, and investors will also appreciate its long track record of consecutive annual dividend increases.

The Case for Chewy

Chewy operates as a leader among retail stocks focused on pet parents across the U.S. and Canada. The company serves approximately 21.3 million active customers and maintains an extensive network of partners, including roughly 20,000 veterinary practices. Following its acquisition of Modern Animal in April 2026, the company has added physical veterinary clinics to its digital platform.

In the fiscal year ended Feb. 1, 2026, revenue reached nearly $12.6 billion, representing growth of approximately 6.2% year over year. The company reported net income of close to $222.8 million for the period. While earnings declined compared with the prior fiscal year, a net margin of roughly 1.8% indicates the company remains profitable while investing in expansion.

The Case for Walmart

Walmart operates a massive omnichannel retail model across 19 countries, serving nearly 280 million customers weekly. The company uses proprietary customer data to bolster its advertising revenue streams following its acquisition of Vizio. This physical and digital reach allows it to maintain a dominant position in the global consumer landscape.

In the fiscal year ended Jan. 31, 2026, revenue reached roughly $713.2 billion, a 4.7% increase compared with the prior fiscal year. Net income for the period was close to $21.9 billion. This performance resulted in a net margin of approximately 3.1%, highlighting its ability to generate significant profit at a massive scale.

Risk Profile Comparison

Chewy faces intense pressure from both online and physical competitors, including direct-to-consumer suppliers and giants like Amazon. The company relies heavily on third-party cloud infrastructure, making cybersecurity and data privacy critical vulnerabilities. Additionally, BCP Partners maintains significant voting control, and failure to comply with complex pet health and pharmacy regulations could lead to fines.

Walmart must execute high-stakes capital investments in AI and supply chain automation to stay ahead of Amazon and Target. The company deals with persistent legal risks, including class actions and regulatory scrutiny related to its massive scale. Furthermore, results are sensitive to global inflation and shifts in consumer spending that can hurt inventory turnover and increase costs.

Valuation Comparison

Walmart carries a higher Forward P/E, comparing its price to future earnings estimates, while Chewy offers a lower P/S ratio measuring price against sales. Metric Chewy Walmart Sector Benchmark Forward P/E 26.6x 39.6x 91.6x P/S ratio 0.7x 1.3x n/a Sector benchmark uses the SPDR XLY sector ETF. Valuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.