Today is Wednesday, December 8, 2021.
Starbucks Stock: Hot or Cold?
Shares of Starbucks (Nasdaq: SBUX) increased 2.56% on Tuesday after an investment firm upgraded the coffee giant’s stock with a positive note.
Details: MKM upgraded Starbucks' stock to buy from neutral and raised the price target to $130 from $114. It also praised the company’s brand and development opportunities.
Challenge: But it wasn’t all good news Tuesday. The National Labor Relations Board ruled that the company cannot stop a union vote that is expected to occur at three Starbucks stores in Buffalo, New York.
More Headwinds: And unionization isn’t the only problem for Starbucks. There are also rising costs for the company, including increased labor expenses.
Numbers: Shares of Starbucks are up 12% this year, but are up only 1% in the past month as the company tries to navigate these issues.
Final Thoughts: Starbucks survived the pandemic well, but can it continue to thrive in the face of so many headwinds?
Notable Earnings Today: GameStop (NYSE: GME), Weber (NYSE: WEBR), Udemy (Nasdaq: UDMY), Campbell Soup (NYSE: CPB), Rent the Runway (Nasdaq: RENT), RH (NYSE: RH), Vera Bradley (Nasdaq: VRA), United Natural Foods (NYSE: UNFI), Thor Industries (NYSE: THO).
Notable IPOs Today: Global X MSCI Vietnam ETF (NYSE: VNAM), Chicago Atlantic Real Estate Finance, Inc. (Nasdaq: REFI), Future Health ESG Corp. Common stock (Nasdaq: FHLT), Cingulate Inc. Common Stock (Nasdaq: CING), Thrive Acquisition Corporation Class A ordinary shares (Nasdaq: THAC).
Notable Equity Crowdfunding Campaigns Ending Today: VUniverse (Netcapital), Golden Coast Mead (StartEngine), Smardii (StartEngine), Live Music Tutor (StartEngine).
Notable Economic Events Today: Job openings (10:00 a.m. ET), Crude oil inventories (10:30 a.m. ET).
Stitch Fix Dives on Poor Guidance
Shares of Stitch Fix (Nasdaq: SFIX) fell 17.86% in after-hours trading on Tuesday after the online personal styling service posted disappointing guidance.
Financials: Stitch Fix reported revenue of $581 million and a loss of 2 cents per share; both numbers were better than what analysts expected.
Bad Outlook: The company said that it was only going to get between $505 million to $520 million in revenue next quarter, which was less than what analysts wanted. Active users increased 11%, which was also underwhelming. It suggests that growth has slowed for Stitch Fix.
Quote: “With the launch of Stitch Fix Freestyle we are expanding and broadening our offering, and we are excited to continue to enhance the experience for clients through the introduction of new product features and expanded merchandise selections, increasing the number of purchase occasions we serve.” - CEO Elizabeth Spaulding.
Final Thoughts: Between potential supply chain challenges and marketplace competition, it has been a rough year for Stitch Fix. The stock is down 55% in 2021.
Amid Inflation, Investors Seek Santa Claus Rally
The Santa Claus rally, a trend where the stock market increases during the end of December and into early January, may not happen this year due to inflation.
Background: The economy has been dealing with inflation and supply chain challenges - both seem to have stymied the markets.
The Bearish Case: The inflation issue has likely been exacerbated by the Federal Reserve, which has kept rates too low.
The Bullish Case: Ocean shipping rates have been falling and companies seem to be surviving any current supply chain issues. This could pave the way for a Santa Claus rally.
Final Thoughts: Even if there is a Santa Claus rally this year, these economic problems could creep up again in 2022.
Trends to Watch
Taking Its Toll: Toll Brothers Sees Strong Demand Drive 20% Revenue Growth in FY 2022 (MarketWatch)
Big Jump: Polygon’s MATIC Token Up 40% Amid Crypto Rebound (CoinDesk)
Offline: An Amazon server outage caused problems for Alexa, Ring, Disney Plus, and deliveries (The Verge)
That’s Quick: Insurtech Locket Hits Crowdfunding Goal in Just 10 Minutes on Seedrs (Crowdfund Insider)
Price Tag: Newest battery SPAC to list at 600x 2021 revenue (Seeking Alpha)
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