A badly received quarterly earnings report was the major news item exerting gravity on Chewy (NYSE: CHWY) stock over the past few days. As a result, according to data compiled by S&P Global Market Intelligence, the company's share price had slumped by almost 15% week-to-date as of Thursday evening.

Investors didn't like the latest milk bone

That sell-off happened even though Chewy actually topped analyst estimates for revenue and profitability, albeit not by vast amounts.

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In its first quarter, the company managed to grow its net sales by more than 8% year over year to $3.1 billion, while its non-GAAP (adjusted) net income improved at a slightly higher rate to just under $149 million ($0.35 per share). Analysts had collectively been modeling a bit below $3.1 billion on the top line and $0.32 per share for adjusted profitability.

While those aren't bad numbers at first glance, Chewy is an expensive stock to own; even after the post-earnings sell-off it was trading at a rich forward P/E of almost 36. For more than a few investors, that's awfully pricey for a company posting single-digit percentage improvements, and at thin profit margins to boot.

Tepid reactions

Meanwhile, as analysts tracking a stock often do, several pundits following Chewy adjusted their takes on the stock. Most of these adjusters raised their price targets, but there were several less bullish updates, too. One was published by Mizuho's David Bellinger, who now feels Chewy is worth $44 per share, down from his previous $47. He maintained his neutral recommendation on the stock.

It's hard to ignore how pricey this stock is at the moment, and to some degree that's a shame. Chewy has been posting good results from its Autoship program lately, a feature that still has plenty of potential to boost valuable recurring revenue. I'm not necessarily hot on this stock, but there might be some upside to it if it can post more convincing quarterly earnings beats.

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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Chewy. The Motley Fool has a disclosure policy.