RH Shares Rise 15%!

RH Shares Rise 15%!

Happy Friday folks! 

As you can tell from the following market stories, earnings reports played a crucial role in stock movement this week. Analyzing a stock's quarterly financials allows us to take a temperature check on our favorite companies and is a key component to investing success. 

However, remember that over the long-term, one quarterly report doesn’t mean as much as product releases, innovative CEOs, and global expansion plans. So if your stocks are declining after its earnings call, take it with a pinch of salt and focus on its long-term potential. 

Using this logic and ‘The Power of Patience’, which our analyst Rory recently covered, will allow you to make the right stock investments to generate long-term wealth.

Here were the biggest movers in the MyWallSt shortlist this week:

Moving Up ⬆️

RH (RH) +15.3%

Stitch Fix (SFIX) +13.5%

PagerDuty (PD) +12.8%

Cloudflare (NET) +12.5%

2U (TWOU) +10.2%

Moving Down ⬇️

Boston Beer Co. (SAM) -7.0%

Brown-Forman (BF.B) -6.4%

Casey's General Store (CASY) -6.1%

TrueCar (TRUE) -6.0%

Calavo Growers (CVGW) -5.9%

 

What investors need to know 

RH (RH) +15.3%

RH earnings nearly quadrupled in the first quarter, posting adjusted earnings of $4.89 per share, up 285% year-over-year (YoY). The high-end furniture store’s results proved a shared theory that wealthier clients, those who were less affected by the pandemic, turned to the furniture company to refurbish their houses while they were stuck inside. The firm also discussed its planned opening of a new store in Dallas, plus three new openings this year. Adding to bullish sentiment over RH is its plans to take its luxury business beyond retail, with intentions to enter into the hotel and housing sectors.

Stitch Fix (SFIX) +13.5%

Stitch Fix had an earnings beat this week, reporting revenue of  $535.6 million, up 44% YoY. While guidance for Q1 was relatively easy to match, investors were happy to hear the company’s plans to make its ‘Direct Buy’ product available to all users by the end of its fiscal year. The service will allow shoppers to buy items from its app, which is currently only available to Stitch Fix subscribers who receive full outfit ‘Fixes.’ By opening up this offering to new clients it will expand its addressable market. Management envisions this new service to become just as big as its core Fix service. 

PagerDuty (PD) +12.8%

PagerDuty shareholders were pleased to see the firm announcing a partnership with JFrog this week. JFrog is a ‘liquid software’ firm and its goal is to make the software update process run automatically and continuously as if the software was just like water. With the deal, PagerDuty clients will be able to monitor their entire software delivery lifecycle in one place. Consumers will also be offered enhanced support in detecting security issues — something businesses are becoming acutely more aware of with increasing cyber-attacks taking place. As a result, the cloud computing company said the partnership should boost sales, great news for shareholders. 

Brown-Forman (BF.B) -6.4% 

Shares fell this week after the Jack Daniel’s distiller’s fourth-quarter profits fell short of expectations but beat sales estimates. Net income for Q4 fell to $120 million from $128 million in the year-ago period. In an unprecedented environment for the alcohol industry, given the ongoing closure of hospitality venues, Brown-Forman highlighted how it still managed to grow its sales while it invested in environmental sustainability and diversity inclusion. Rather than focusing on lower profits, shareholders should remember that the firm’s sales should surge once pandemic restrictions are lifted, especially when holidaymakers return to bars and nightclubs around the globe.

Calavo Growers (CVGW) -5.9% 

The avocado producer saw shares fall this week after its earnings report proved that it is still struggling from the effects of the pandemic. Calavo’s revenue of $276.8 million was down 1.5% year-over-year (YoY), which missed Wall Street’s estimates. In the wider market, demand for food produce is increasing as restaurants return to normal business, which should help the company boost its profits. This trend has already translated into the company’s financials after the farm products firm reported 9% growth in avocado sales during the quarter.

NicoleNicole

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