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Investors in growth stocks can spot a new entry point by looking for the three-weeks-tight, an unusual short-term chart pattern. Consider L Brands in 1982.
On the heels of Gap's February announcement that it would separate into two businesses, activist hedge fund and shareholder Barington Capital called for a similar move at L Brands LB . While investors sent Gap shares up more than 20% on the news that Old Navy would be a stand-alone business, we think such a breakup could be even more favorable for L Brands, given the lucrative 20%-plus operating margins of its Bath & Body Works segment and the upside that two distinctly focused businesses could create. Old Navy's same-store sales growth has already begun to slow and enterprise operating margin has contracted more than 500 basis points since 2013, a trend that might put such a transaction at risk.
The ascending base is a rare yet very bullish pattern. Look for it to form after a good stock has broken out of a cup or double-bottom base.
What should investors take away from Best Buy and L Brands earnings' reports? Jim Cramer rounds up retail and looks ahead to Foot Locker's earnings' report Friday before the bell.
Analyst Michael Binetti is not fully convinced, maintaining a Neutral rating with a $25 price target. The first quarter was another early signal of stabilization in L Brands' negative trends, he said.
U.S. stocks slumped on Thursday as investors dumped shares of companies in growth and cyclical sectors, with energy and technology leading declines, on fears that the escalating U.S.-China trade war would stymie global economic growth. Among S&P 500 sectors, only utilities and real estate, both considered defensive areas, registered gains as investors moved to safe-haven assets such as Treasuries. Stocks pared losses in the last hour of trading, but Wall Street's major indexes all ended more than 1% lower.
Shares of Lowe's Companies Inc. (LOW) tumbled 11.85% to $97.94 on Wednesday after missing consensus estimates on non-GAAP earnings for the first quarter of fiscal 2019 by 11 cents. It posted $1.22 per diluted share, a 2.5% increase from the prior-year quarter. Warning! GuruFocus has detected 2 Warning Signs with LOW.
L Brands Inc. bucked the trend: Not only were the retailer’s shares spared, they were on pace for their best one-day gain since 2009 after a better-than-expected first quarter earnings report. Investors were clearly dazzled by the strong performance of its Bath & Body Works chain, which delivered booming comparable sales growth of 13% from a year earlier – a gain that’s especially impressive given that it came on top of an 8% lift on this measure a year earlier. The health of the company depends on a revitalization of its largest brand, Victoria’s Secret, and these latest quarterly results did little to demonstrate that real change is taking hold there.
Check out the companies making headlines midday Thursday:L Brands LB — L Brands surged 12.8% after the parent company of Victoria's Secret and Bath & Body Works reported first-quarter earnings that surpassed expectations .
U.S. stock indexes fell more than 1% on Thursday, as investors sold off technology, industrials and energy stocks on fears that a spiraling trade war between the United States and China would crimp global growth. Microsoft Corp and Apple Inc were down more than 1%, dragging the sector lower, while the chip index dropped 2.3%.
Jim Cramer digs into his latest Real Money opener on U.S.-China trade war, shares his latest thoughts on Tesla, and looks at Best Buy and L Brands, Foot Locker earnings' reports.
jumped in trading Thursday after the parent company of Victoria's Secret and Bath & Body Works posted first-quarter earnings that surprised Wall Street and lifted the low end of its earnings guidance for the fiscal year. Same-store sales at Victoria's Secret declined 5% but jumped 13% at the company's Bath & Body Works outlets. L Brands said it expects fiscal-year earnings of between $2.30 and $2.60 a share, vs. its previous guidance of $2.20 to $2.60.
U.S. stock futures pointed lower on Thursday and global stocks declined as investors hunkered down for a prolonged U.S.-China trade dispute. Treasury Secretary Steven Mnuchin told the House Financial Services Committee that there were no scheduled talks with high level officials in Beijing, but added Wednesday that presidents Donald Trump and Xi Jinping likely would meet at next month's G-20.