Buy up this Amazon Proof Retailer Now

The pandemic over the past 18 months has fueled several industries in unpredictable ways. E-Commerce companies with defendable moats have grown significantly, subsectors such as food delivery, furniture shopping, and leading retail eCommerce companies have been on fire.

Whether you have a bird, reptile, cat, dog or rabbit, Chewy.com caters to pet owners and has aruably the most comprehensive list of toys, pet pharmaceuticals, food and many other items. Chewy is the Amazon of Pet shopping, and we believe with approximately a $30B market cap and revenue of $8.1B, it could also be an acquisition target. The company is growing, recently achieved profitability, and has a lot of growth left in it.

Shares currently trade around $75, and we purchased the Jan 2023 $80 Calls for $14.45 and sold the same strike $70 Puts for $12.90, for a net cost of $1.55 on this trade. This synthetic long position gives us positive returns as the stock rises, and we'd be forced to purchase shares if they drop below $57.10, or we'd close the positions at a loss before expiration.  

As long as the market is ripping, we're comfortable with this trade and considering it has a Beta of .6 we view this as a medium risk trade.