When stocks slump by 30% in some cases amid a record-breaking bull market, treat their sale price with suspicion.
J.M. Smucker (SJM) fell from around $120 to close at $114.68 recently. The firm lowered its full-year sales guidance. In the first quarter, revenue grew by 18% Y/Y to $319.9 million. Comparable sales grew by 1%, helped by volume/mix. Meow Mix, for example, lifted results while contract manufacturing sales hurt results. Its business momentum in the U.S. is worsening. For the full year, the firm expects earnings per share of $9.60 to $10.00.
Ulta Beauty (ULTA) dropped by nearly 7% last week. Revenue rose by 4.0% Y/Y to $2.6 billion. FY 2024 results include a negative 2% to 0% comparable sales growth range.
In the drugstore sector, Walgreens Boots (WBA) lost 11.19% last week. Investors are bearish on drugstore sales. Firms like Eli Lilly (LLY) and Pfizer (PFE) are increasingly dependent on their D2C (direct-to-consumer) business. They are selling products online, bypassing Walgreens.
In the chip sector, Micron Technology (MU) continued its downtrend after peaking at over $150 in June. The firm bought two Taiwan factories from AUO, paying $254 million. The market’s reaction signals a cyclical downtrend began for MU stock.
MU stock might bottom at $65 - $75. Avoid trading the stock whenever shares rally. Use those moments to reduce the position.
Related Stories
