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Lululemon Holiday Season Flop
A disappointing outlook sent shares of Lululemon Athletica (Nasdaq: LULU) down 7.51% in after-hours trading on Thursday.
Financials: In its financial earnings release that came out on Thursday, Lululemon reported earnings of $2 per share and revenue of $1.9 billion; both were better than expected.
Big Growth: The most recent quarter saw a lot of growth for Lululemon. Net revenue increased 28%, total comparable store sales grew 22%, direct-to-consumer net revenue shot up 31%, and gross profit increased 25%.
Outlook: The issue with Lululemon’s earnings was the guidance. Lululemon expects revenue in the current quarter to be between $2.605 billion to $2.655 billion, which was lower than expected. The problem is that the current quarter is the holiday shopping season and investors expect retailers such as Lululemon to outperform.
Stock Price: Shares of Lululemon are down 3% this year, but are up 16% in the last 30 days.
Final Thoughts: Is Lululemon being too careful with its guidance by being lower than expected, or is the company warning investors about a tough future?
Notable Earnings Today: Li Auto (Nasdaq: LI).
Notable IPOs Today: SONDORS Inc. Common Stock (Nasdaq: SODR).
Notable Equity Crowdfunding Campaigns Ending Today: Mayes NYC (Honeycomb), Dick & Jane’s BarRoom (Mainvest), Bizfluence (StartEngine), Starco Brands (Dalmore Group), LPPFusion (Wefunder), UcarMobile (Silicon Prairie Online).
Notable Economic Events Today: Producer Price Index (8:30 a.m. ET), Michigan Consumer Expectations / Sentiment (10:00 a.m. ET), WASDE Report (12:00 a.m. ET).
Costco Sees Online Sales Slip
Photo by Marques Thomas / Unsplash
It was a mixed bag of financial earnings results for Costco Wholesale Corporation (Nasdaq: COST), and shares dipped by 0.29% in after-hours trading on Thursday.
Financials: Costco reported earnings of $3.07 per share and revenue of $54.4 billion; both were below estimates.
Online Drop: Sales for Costco’s e-commerce unit dropped 3.7%. Investors expected more out of Costco.
Areas of Growth: Despite the miss with online sales, in-person sales were good. Overall net sales increased by 8.1%. In the U.S., sales went up 9.3%.
Stock Price: Costco’s stock is down 15% this year, including a 1.76% drop in the last 30 days.
Final Thoughts: Investors are mixed about these results. In-store sales are showing resilience in the face of a potential recession, but online sales are headed in the wrong direction.
United Airlines’ Big Boeing Order
Background: Reuters also reported last week that both sides were close to reaching a deal.
Stock Price: Both stocks are down this year but are up as of late. United Airlines is down nearly 6% this year but is up 1% in the last 30 days. Boeing is down 13% this year but is up 6% in the last 30 days.
Final Thoughts: This deal is good news for both companies, although neither has commented yet. On Wednesday, Wolfe Research downgraded several travel stocks, citing potential declining demand. Lower travel demand could spell trouble for both of these travel stocks.
Trends to Watch
Grey Skies: Grayscale Bitcoin Trust Discount Widens to Record High Near 50% (CoinDesk)
Chapter 11: Bankruptcy worries swirl around used car retailer Carvana (CNN)
Circle Your Calendars: Ethereum developers target March 2023 for Shanghai hard fork (Cointelegraph)
New Pattern: Mortgage rates hit lowest point since September (Yahoo! Money)
What's the Matter with Kansas: Keystone pipeline shut after 14,000-barrel oil spill in Kansas (Reuters)
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