Peloton Soars 8%

Peloton Soars 8%

Happy Friday folks! 

It was another hectic week for the companies on our shortlist, with product launches, S&P 500 inclusion, and equity offerings splashing across the headlines. As earnings season wraps up, just some of the biggest movers on our list were impacted by their financial releases, giving our analysts a nice breather from the numbers. 

So without further ado, let’s get down to the stories.

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

Moving Up ⬆️

Upstart Holdings (UPST) +17.1%

Peloton Interactive (PTON) +8.6%

Lululemon (LULU) +8.3%

RH (RH) +6.8%

Match Group (MTCH) +6.4%

Moving Down ⬇️

Calavo Growers (CVGW) -15.7%

Smartsheet (SMAR) -10.5%

DocuSign (DOCU) -9.3%

Sea Limited (SE) -8.7%

Chegg (CHGG) -7.8%

 

What investors need to know

Peloton Interactive (PTON) +8.6%

Shares are rising after the company unveiled plans to launch its own branded fitness clothing. Peloton’s new activewear line is going to feature a mix of men's, women's, and gender-neutral offerings — including jerseys, hoodies, tights, and shorts — ranging from $15 to $118. The new revenue stream is great news and might help offset some of the losses Peloton will incur after lowering the cost of its signature fitness bike by 20%. Some experts are even hinting that the fitness equipment maker might take market share from athletic apparel brand, Lululemon, but we’ll have to wait and see. 

Lululemon (LULU) +8.3%

Speaking of Lululemon, the stock hit all-time highs after its blockbuster earnings report this week. Stay-at-home wardrobes became very popular during the pandemic as people swapped gyms and offices for the living room, helping Lululemon report adjusted earnings of $1.65 on sales of $1.5 billion, up 61% compared to year-ago figures. Famous for its yoga leggings and ABC jogger pants, the firm’s sales have outperformed other rival retailers so far this year. Even as we emerge from lockdown restrictions, many believe that Lululemon will remain popular as consumers' gravitation towards comfort is likely to remain. 

Match Group (MTCH) +6.4%

Confirmation of its inclusion in the S&P 500 sent shares rising this week. The major index swiping right on the dating company means that the stock will now benefit from passive investing through various funds aligned with the index. The Tinder-owner will also be given greater access to capital markets and cheaper debt thanks to the prestige associated with being a part of this elite group of stocks. With the inclusion, the stock will also enjoy greater stability in its share price. It is likely that the stock will gain when it is added on September 20, but really, the news doesn’t affect the company’s long-term investment thesis.  

Calavo Growers (CVGW) -15.7% 

Calavo Growers’ CEO retired this week just as the stock dipped to a 52-week low after the avocado producer posted disappointing earnings. The fruit distributor (yes, an avocado IS a fruit) reported an adjusted loss of $0.17 per share in its Q3 earnings, which was compared unfavorably to the positive earnings of $0.73 it recorded in the year-ago period. Labor and supply chain shortages weighed heavily on it last quarter, in addition to “the delayed summer avocado crops coming from California and Mexico impacted our margins and profitability.” Despite these challenges, Calavo still was able to report sales growth of 5% from year-ago revenues with it stating that the underlying fundamental drivers of its business remain intact. 

Sea Limited (SE) -8.7%

A proposed new share offering sent  Sea Limited’s shares tumbling this week. If successful, the e-commerce and gaming leader will raise $6.3 billion, marking the largest equity offering the market has witnessed in 2021 so far at 11 million shares worth $3.8 billion. While this short-term news might concern shareholders about the dilution of their investment, the company has big plans about what to do with the funds. Expanding its e-commerce efforts in Latin America and food delivery in Southeast Asia, plus this week's news that it is launching its Shopee app in Poland, all of which will drive revenue and profits for the company.

NicoleNicole

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