Last week was great for stocks. Wall Street rose on Friday, with the major averages all ending within sight of their recent records amid continued optimism about the US economic recovery
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The blue chip and benchmark climbed 0.9% and 1.2% respectively this week, both breaking a two-week loss streak. The tech heavy, meanwhile, advanced 2.1% in the same time frame to put in his best weekly performance since April 9.
This week we're getting more high-profile earnings reports from companies like Zoom Video (NASDAQ :), DocuSign (NASDAQ :), Slack Technologies (NYSE :), and Crowdstrike Holdings (NASDAQ :), just to name a few.
And despite the holiday-shortened week, another round of important economic data will also be released, including May, making this week a busy week.
No matter which direction the market is heading, below we highlight one stock that is likely to be in high demand and the other that may have further downsides.
However, keep in mind that our timeframe is for the next week only.
Stock to Buy: Express
Express (NYSE 🙂 will catch the eye this week as investors await the latest financial results from the mall-based fashion apparel store, which includes apparel and accessories for work, leisure and entertainment.
Shares of the Columbus, Ohio-based company rallied last week and received a boost as part of the "Meme Stock" phenomenon, which includes names like GameStop (NYSE :), AMC Entertainment (NYSE 🙂 and Blackberry (NYSE). 🙂 are scoring big profits this year.
Like GME, AMC and BB, Express has emerged as a popular stock among retailers on Reddit's WallStreetBets forum, despite the percentage of shares outstanding being held short, had fallen sharply.
EXPR shares, which started the year at about $ 0.90 and ended at the 52-week high of $ 13.93 in late January, finished at $ 4.29 on Friday, giving the small-cap company a valuation. of approximately $ 284 million.
Despite intense volatility, stocks of the apparel and accessories chain have gained 371% since the beginning of the year, far ahead of the comparable returns of both the Dow and S&P 500.
Consensus expectations call for a loss of $ 0.52 per share when Express releases first quarter results ahead of Thursday's opening bubble, substantially compared to a loss per share of $ 1.55 in the same period one year ago. Sales are expected to grow 53% year-on-year to $ 322.1 million.
In addition to top and bottom line numbers, investors will look to see if the apparel retailer's comparable sales improve in the same store, after a 27% decline in the previous quarter due to the negative impact of COVID-19.
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Market players will also be curious to learn more details about the company's new e-commerce strategy, which aims to expand its digital channel to $ 1 billion in revenue by 2024.
Based on options market activity, traders are pricing in a big step for Express shares based on the results, with a potential implied shift of about 9% in either direction. Stock To Dump: The Clorox Company
fleeting week amid diminishing fears about the spread of the coronavirus in the US
COVID-19 cases continue to decline across the country, falling to its lowest level in nearly a year as the number of people vaccinated continues to grow.
The current 7-day moving average of daily new cases in the US fell 22.3% from the previous week to 21,627, the lowest level since June 2020, according to the latest figures from the Centers for Disease Control and Prevention.
Even more encouragingly, the current 7-day average is down 91% from a peak of about 253,000 reached in early January.
Courtesy of CDC
Taking that into account, the supply of Clorox could decline further in the coming days as the improving health outlook is likely to cause more states to drop their pandemic-era social restrictions.
That should translate into fewer supplies for the COVID era, such as hand sanitizer, cleaning wipes, and other disinfectant products.
The company's bleach and disinfectant wipes account for approximately 25% of its sales. Perhaps more importantly, Clorox's cleaning segment, which includes these products as well as other brands such as Pine-Sol and Green Works, generates 53% of Clorox's total revenue.
Clorox has seen its stocks fall steadily to new lows, even as the broader market shows signs of recovery from the recent onslaught of volatility. Year-to-date, shares have lost 12.5%, compared to the S&P 500's 12% gain over the same period.
The CLX stock, now about 26% below its all-time high of $ 239.85, closed Friday's session at $ 176.73, the lowest since April 2020.
At current levels, the Oakland, California-based consumer products giant has a market cap of approximately $ 22 billion.
