Today is Friday, November 18, 2022.
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Palo Alto Networks' Fear Bet
Positive financial earnings set shares of Palo Alto Networks (Nasdaq: PANW) up 6.99% in after-hours trading on Thursday.
Financials: Palo Alto Networks reported earnings of 83 cents per share and revenue of $1.56 billion; both were better than expected.
Growth: Billings grew 27% year-over-year. Revenue soared 25%. The company generated $1.2 billion in free cash flow.
Quote: “Our growth in Q1 was driven by customers continuing to increase their commitments to our security platforms as they are able to choose our best-of-breed capability and simplify their security architecture.” - Nikesh Arora, chairman and CEO of Palo Alto Networks.
Outlook: Palo Alto Networks also raised its full-year guidance and expects revenue to be in the range of $6.85 billion to $6.91 billion.
Final Thoughts: Palo Alto Networks capitalized on the growing cybersecurity fears in the market. However, the price of the stock might be overvalued for some investors.
Notable Earnings Today: JD.com (Nasdaq: JD), Foot Locker (NYSE: FL), Buckle (NYSE: BKE), Twist Bioscience (Nasdaq: TWST), Spectrum Brands Holdings (NYSE: SPB).
Notable IPOs Today: N/A.
Notable Equity Crowdfunding Campaigns Ending Today: Groundfloor (Wefunder), Upshift (Republic), Osena Spiked Coconut Water (SeedInvest), QUAS Brewpub (Mainvest), Stigma Cannabis (Silicon Prairie), VenuePilot (StartEngine), fouRy (StartEngine).
Notable Economic Events Today: Existing Home Sales (10:00 a.m. ET).
Gap Easily Brushes Off Yeezy
Surprisingly good financial earnings sent shares of Gap (NYSE: GPS) up 7.4% in after-hours trading on Thursday.
Financials: Gap reported revenue of $4.04 billion, which was better than expected. Comparable sales went up 1% year-over-year.
Yeezy Street: The company suffered $53 million in impairment charges when it cut ties with entertainer Kanye West (Yeezy), but that didn’t impact the financial results at all.
Quote: “We have sharpened our focus on execution to optimize profitability and cash flow, are bringing more rigor to our operations, and balancing our assortments in response to what our customers are telling us.” - Bob Martin, Executive Chairman and Interim CEO, Gap.
Final Thoughts: Down 30% this year, Gap is trying to turn things around. The company has shown a lot of improvement - enough to make investors optimistic. The question is will large macro trends hurt consumer spending?
Williams-Sonoma’s Higher Shipping Costs
Shares of Williams-Sonoma (NYSE: WSM) were down 6.97% in after-hours trading on Thursday after the retail company reported disappointing financial earnings.
Financials: Williams-Sonoma posted earnings of $3.72 per share, which was below estimates. Revenue hit $2.19 billion, which was better than expected.
Going Low: The gross margin in the quarter was 41.5% and way lower than last year. The company blamed higher shipping and freight costs.
Final Thoughts: Williams-Sonoma said that the macro backdrop has become uncertain. The stock is down 22% this year. Shipping costs need to get under control before most investors would feel comfortable about this stock.
Trends to Watch
Get Ready for 2023: Amazon CEO says layoffs will extend into next year (The Associated Press)
New Boss: Visa says Ryan McInerney will replace Al Kelly as its next CEO (CNBC)
A Stable Coin: Bitcoin Holds Steady Over $16K Amid Widening FTX Fallout (CoinDesk)
Guilty by Association: Wall Street Sours on Coinbase, Signaling Broad Crypto Doubts (The Wall Street Journal)
Didn’t See This Coming: Alibaba Posts Surprise Loss as China Covid Curbs Take a Toll (Bloomberg)
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