Wednesday will mark the last full trading session of the holiday-shortened trading week. It’s no surprise then that Tuesday marked a rather quiet session in the stock market today.
The SPDR S&P 500 ETF (NYSEARCA:SPY) spent most of the session higher by about 10 basis points, but finished higher by 0.2%. That’s about where the SPDR Dow Jones Industrial Average (NYSEARCA:DIA) and the PowerShares QQQ ETF (NASDAQ:QQQ) finished too.
Like I said, it was a quiet day. That is, except for the companies reporting earnings.
Burlington Stores (NYSE:BURL) shares jumped roughly 9% on the day after reporting its third-quarter results. Earnings of $1.55 per share beat estimates by 15 cents, although sales of $1.8 billion did miss expectations by $20 million. While comparable-store sales growth of 2.7% beat estimates of 2.6%, some investors are likely surprised by the rally.
Burlington missed on sales and gross margin expectations, barely topped comp-store sales estimates and the midpoint for both revenue and earnings guidance missed consensus views. At the midpoint, management expects 9.5% sales growth for Q4 and earnings of $3.19 per share. That compares to estimates of 9.7% growth and earnings of $3.21 per share, respectively.
Palo Alto Networks (NYSE:PANW) was the complete opposite. Shares plunged 12% on the day, despite better-than-expected fiscal Q1 earnings and revenue results. Management provided roughly in-line guidance for Q1 and full-year revenue. However, earnings for both periods came up short of expectations.
Both stocks made the Top Stock Trades column on Tuesday.
Burlington wasn’t the only retailer hitting new highs on Tuesday, as it was joined by Best Buy (NYSE:BBY). Like Burlington, Best Buy delivered a top- and bottom-line earnings beat. Better-than-expected same-store sales helped too, but the real kicker was guidance. Management raised its full-year earnings outlook to a range of $5.81 to $5.91 per share, up from $5.60 to $5.75 per share and well ahead of consensus expectations calling for $5.76 per share.
Dollar Tree (NASDAQ:DLTR) was moving higher ahead of earnings, but just couldn’t deliver a good enough result. Earnings of $1.08 per share missed analysts’ estimates by 5 cents, while revenue barely topped estimates.
However, the midpoint of management’s fourth-quarter revenue guidance came up short of expectations, while earnings came well short of estimates. Management expects Q4 earnings of $1.70 to $1.80 per share vs. Street expectations of $2.02 per share. Oops.
Movers in the Stock Market Today
Burlington and Best Buy were some of the largest movers in the stock market today. Like the earnings or hate them, we need to respect this type of price action. For a sector that’s been littered with disasters — Dollar Tree, Macy’s (NYSE:M), Home Depot (NYSE:HD) and Kohl’s (NYSE:KSS) are just a few examples — there have been some strong winners on the list too.
We didn’t mention Dick’s Sporting Goods, (NYSE:DKS), but this stock was up 18.6% on Tuesday on better-than-expected results. Target (NYSE:TGT) and Lowe’s (NYSE:LOW) both ripped to new all-time highs this month on earnings. Walmart (NYSE:WMT) reported solid results, although it failed to hold its post-earnings gains. Nordstrom (NYSE:JWN) has also done well since reporting earnings.
The point is, despite a number of double-digit haircuts we’re seeing in the sector, there are some names that are doing very, very well. Some are certainly names to keep on the watch list as buy-on-dips candidates.
Disney (NYSE:DIS) shares — which also made the Top Stock Trades list — hit new all-time highs Tuesday. Shares were in breakout mode after reports surfaced about momentum in its Disney+ program. According to Apptopia, the company is logging almost 1 million new subscribers per day. If true, expectations may still not be high enough for Disney+.
Fitbit (NYSE:FIT) has already agreed to be acquired by Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) for $2.1 billion in cash. We knew that. But what we didn’t know is that Facebook (NASDAQ:FB) was the other company bidding for Fitbit. While it doesn’t matter much now, as FB considers the process over, it’s interesting to see that it too wanted Fitbit and its data.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long GOOGL and DIS.