Market Movers: A Rare Good Week For the U.S. Markets
Happy Saturday folks,
It was a better week on the markets this week, with all the major indices in the green at time of writing.
It seems that after the bloodbath of the past few weeks, many investors are now stepping back into the market to pick up some stocks that they feel may have been oversold — see the likes of Datadog and Teladoc in our top movers, for example.
In addition to this, the release of worse-than-expected economic figures for the U.S. actually might have helped things too. Although it may seem counterintuitive, a fall in areas like manufacturing and spending can be considered good news at the moment as it means that the economy is cooling down, which should help tamp inflation too.
Although we’re not out of the woods by any means yet, signs like this indicate that further rate hikes might not be needed, which buoyed investors.
Let’s dig more into our market movers:
Here were the biggest movers in the MyWallSt shortlist this week:
Moving Up ⬆️
Trupanion (TRUP) +18.0%
Datadog (DDOG) +17.5%
Teladoc (TDOC) +17.0%
Cloudflare (NET) +17.0%
Avalara (AVLR) +16.9%
Moving Down ⬇️
Nordstrom (JWN) -5.8%
Tripadvisor (TRIP) -5.7%
Wynn Resorts (WYNN) -5.3%
Airbnb (ABNB) -3.8%
Booking Holdings (BKNG) -3.8%
The Winners ⬆️
No major news coming out of Trupanion this week, but considering that its share price has fallen more than 50% this year already, it seems to be a case of the market spotting the company as a bargain.
Trupanion is a company that provides medical insurance plans for dogs and cats in the United States, Canada, and Australia. As per its last quarterly results, the company has close to 1.3 million pets on its books in total and is adding more and more every quarter in record numbers.
The market for pet insurance is huge and largely untapped. And while it might seem crazy to some that people are paying hand-over-fist to insure their furry friends, recent surveys indicate that 91% of U.S. "pet parents" consider their pets to be family members, while 81% consider them as equal members of the family.
Of course, this means big business for the companies involved like Trupanion, with Fortune Business Insights estimating the global pet-care market to grow at a 6% CAGR to $326 billion by 2028.
Indeed, Trupanion isn’t the only pet-related company that we’ve been analyzing this week. Check out Mike’s First Look on another exciting stock in the pet industry — Zoetis.
Funnily enough, it seems to have been an error at Cloudflare that pushed its stock up this week.
On Tuesday, the company suffered an outage at 19 of its data centers that handle a “significant proportion” of Cloudflare’s global traffic. The centers were only down for a little more than an hour according to the company’s press release, but some of the world’s most popular websites like Amazon, Shopify, and Doordash were all affected.
Cloudflare provides tech companies with edge network security and content delivery services (CDN), securing them against harmful DDoS (Distributed Denial-of-Service) attacks. So, while an outage like this is never good, the fact that the fault was due to an internal issue rather than a malicious attack was positive news.
Of course, the incident also probably served to remind investors just how many apps and sites are customers of Cloudflare.
The Losers ⬇️
There was no material news that came out about TripAdvisor over the past few days, but what seems to have affected the stock — alongside Wynn Resorts, Airbnb, and Booking Holdings — is growing worries over travel demand for the coming summer season.
As investors worry about the threat of an impending recession, the travel industry is one that could be hit hard by a drop in consumer spending. The wider market has already seen a strong recovery in areas like restaurant dining and bricks-and-mortar retail, as consumers escape COVID restrictions and begin to enjoy real-life experiences again.
However, if things continue the way they are in terms of the broader economy, many might choose to forego their summer vacations and rob the travel industry of the post-COVID boost it so desperately needs.