WDC stock is up 36% this year
Western Digital (WDC) stock has gained close to 36% so far in 2019. Why has the stock risen despite the company’s dull revenue and earnings forecast?
WDC was trading at $106.5 in March 2018 and fell 66% to $35.9 in December, so it looks like the weak revenue forecast that drove the stock lower last year has already been priced in.
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Stock rose 9.8% on March 21
WDC stock rose 9.8% to close at $51.78 on March 21, 2019. This price rise followed Micron Technology’s (MU) earnings call, during which its management remained optimistic and said that it expected the semiconductor market to recover in the second half of 2019.
NAND memory chip suppliers such as WDC and Micron have been affected by oversupply, which has resulted in price falls for their chips. The overall demand for NAND is expected to pick up later this year.
The stock prices of WDC’s peers Micron, Seagate (STX), and Applied Materials (AMAT) have also recovered this year and are up 34%, 27%, and 27%, respectively, after a difficult 2018. The VanEck Vectors Semiconductor ETF (SMH) has also gained 28% in 2019 after falling close to 12% in 2018.
McCormick (MKC) stock bounced back in the past two months. The stock has risen ~23% since February 1.
Broadcom (AVGO) stock fell ~8.5% after markets closed yesterday following the semiconductor giant's fiscal 2019 second-quarter earnings release. It missed analysts' revenue estimate and cut its fiscal 2019 revenue guidance by $2 billion to $22.5 billion due to sluggishness in its semiconductor solutions business.
The SPDR Gold Shares ETF (GLD), which tracks physical gold prices, has underperformed the broader markets year-to-date, rising just 4.4% compared to the S&P 500’s (SPY) gain of 15.9% as of June 14. The sentiment for gold, however, has been turning around.
Safe havens such as Treasuries and gold were back in favor on June 14 as stocks fell due to rising tensions in the Middle East, concerns over growth, and the looming threat of the US-China trade war. The tech-heavy Nasdaq Composite Index fell 0.67% in the first hour of trading.
Lululemon (LULU) stock rose 2.1% on June 13 in reaction to better-than-expected first-quarter results and an upgraded outlook for fiscal 2019 overall. The company's first-quarter adjusted EPS grew 34.5% to $0.74 on revenue growth of 20.4% to $782.32 million. Analysts had expected EPS of $0.70 and revenue of $755.31 million. Here's why the outlook got an upgrade.
As of 4:40 AM Eastern Time today, US crude oil active futures were at $51.83, ~4% below their closing level in the previous week. If US crude oil prices stay at those levels today, they'll mark their third week of decline in five weeks.
Amazon is discontinuing its Amazon Restaurants service, which has been delivering food for restaurants in parts of the United States. Amazon Restaurants launched in the United States in 2015 and entered the British market the following year. However, it met strong opposition in the British market.