|Day's range||56.06 - 56.06|
Investors targeting declines in U.S. stocks saw sizeable gains during last week's sell-off, as markets plunged on concerns that the spread of the coronavirus was accelerating beyond China. Short sellers - who hope to profit by selling borrowed shares and buying them back later at a lower price - logged a one-week paper profit of $104.77 billion in the last week of February, according to data from financial technology and analytics firm S3 Partners measuring bets against U.S.-listed stocks and American Depositary Receipts.
(Bloomberg) -- Wayfair Inc. shares tumbled Monday, extending its sell-off to a seventh straight trading day, after fourth-quarter results missed expectations and revenue growth thus far this quarter that’s trending below historical rates.The company also warned Friday that the coronavirus was resulting in disruptions to its supply chain, prompting a round of analyst caution. The average price target for the online furnishings retailer currently stands around $83, down from $97 a week ago.Shares dropped as much as 13% in Wayfair’s seventh straight decline, the longest such streak since August. The stock has shed more than 30% of its value over the seven-day collapse, and is on track for its lowest close since 2017.Here’s what analysts are saying:Deutsche Bank, Kunal Madhukar“We may be at the center of a perfect storm,” with the prospect of a further deceleration in sales coming on the heels of “multiple quarters of slowdown from tariff relation market dislocation.”“It is tough to say whether this is the low,” given the difficulty of assessing the length and breadth of the impact of the coronavirus. However, “investor concerns likely are more than priced into the shares already,” and it is more likely the stock will be higher in a year’s time, assuming the economic outlook “does not deteriorate materially.”Buy rating, price target lowered to $77 from $100.Morgan Stanley, Simeon Gutman“Near-term results are likely to fall short of market expectations,” and this “creates an unfavorable risk/reward skew” relative to peer companies.The company is “facing persistent headwinds to revenue growth,” and it will be “tricky” to “reinvigorate revenue growth while cost cutting in the near-term.”Underweight rating, price target cut to $55 from $65.DA Davidson, Tom ForteThe company could achieve “sustainable profitability much earlier than we had previously forecast,” though this would come “at the cost of a much lower rate of sales growth.”Underperform, price target cut to a Street-low view of $45 from $65.Canaccord Genuity, Maria RippsThe focus on improving profitability “should lead to positive adj. Ebitda in the U.S. at some point in 2021.”The company has “a valuable competitive moat” and it should see market-share gains ahead; it has “a long runway for growth.”Buy rating, price target lowered to $100 from $130.William Blair, Dylan Carden“Supply constraints stemming from the coronavirus” have “clearly caught the company off-guard.”“Concerns over further deceleration in revenue and lack of visibility in the ultimate path to profitability at increasing levels of cash burn will remain bigger concerns” than valuation.To contact the reporter on this story: Ryan Vlastelica in New York at email@example.comTo contact the editors responsible for this story: Catherine Larkin at firstname.lastname@example.org, Courtney DentchFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
This week's sharp stock sell-off helped activist short-seller Andrew Left profitably close a long-held bet against online retailer Wayfair on Friday. "I have been short Wayfair for four years and I actually covered it this morning," Left said in an interview. Wayfair shares closed down 10.2% on Friday after the company posted a wider-than-expected quarterly loss.
(Bloomberg) -- Wayfair Inc., which relies on China for half of its products, fell the most ever after saying its quarter-to-date revenue growth is trending just under 20%, well below historical rates.If that growth rate tracks through the rest of the quarter, it would be the slowest growth in its history as a public company, according to data compiled by Bloomberg. Wayfair expects first-quarter net revenue in the $2.235 billion to $2.275 billion range, the company said on its earnings call. That compares with the average analyst estimate of estimate $2.47 billion and is below the low end of analyst expectations.Wayfair said its forecast doesn’t factor in any significant impact from the virus, although it’s seeing some disruptions in the supply chain. The Boston-based online furnishings retailer also reported a wider-than-expected loss in the fourth quarter, while net revenue narrowly beat estimates.The shares fell as much as 26% on Friday. The stock had already lost 22% this year, compared with a 5.8% decline in the Russell 1000 Consumer Discretionary Index.Wayfair issued additional guidance on its earnings call:Sees first-quarter adjusted Ebitda margin in the negative 7.3%-7.8% rangeSees first-quarter U.S. revenue growth 14%-16%, sees international growth 22%-25%Sees more consistent positive adjusted Ebitda in the U.S. sometime in 2021Said it’s confident in its long-term gross margin targetsCapex to remain elevated in first quarter at 5%-5.5% of salesTo contact the reporters on this story: Janet Freund in New York at email@example.com;Courtney Dentch in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Chris Nagi at email@example.com, Catherine LarkinFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
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