Investors still seemed spooked after Federal Reserve Chairman Jerome Powell essentially told Wall Street that the central bank would continue to raise interest rates until inflation was brought to heel even if it meant rising unemployment and a recession. E-commerce stocks like Wayfair (NYSE: W), Farfetch (NYSE: FTCH), and Global-E Online (NASDAQ: GLBE) were on the decline today as the sector is exposed to rising rates in multiple ways. Finally, higher interest rates have also made the dollar stronger against international currencies, a challenge for global companies like Farfetch and Global-E Online, as dollar-denominated earnings for international companies are worth less when the dollar is strong.
Wayfair (NYSE: W) shares are trading near the lows they set during the first acute phases of the pandemic. The company is clearly going through a rough patch today as consumers change their spending patterns back toward in-person shopping. A rebound is inevitable over the next several years, but will Wayfair be able to capitalize on it?
It's not hard to see why Wall Street is avoiding Wayfair (NYSE: W) stock today. The good news is that Wayfair might continue winning market share in the home furnishings sector so the inevitable industry rebound puts it back on pace to dramatically increase sales over the next decade. Let's take a closer look at whether that bullish outlook makes sense today, or if Wayfair instead is likely to be a drag on investors' portfolios from here.