Stocks on Wall Street ended mixed on Friday to close out another week as investors watched the start of the third quarter.
Despite Friday's choppy performance, the and were up 0.1% and 0.2% respectively to earn their third consecutive weekly profit. The meanwhile climbed 0.8%, which amounts to a winning streak of four weeks.
Looking ahead, here we will highlight one stock that has proven to be able to successfully navigate the current whip saw market and another stock that is likely to suffer more losses in the coming days. Mexican Grill
Chipotle Mexican Grill (NYSE 🙂 is one of the top performers in the restaurant industry this year as stay-at-home measures aimed at reducing the spread of the COVID-19 pandemic fueled the demand for its mobile ordering options, especially among young people.
Since the beginning of the year, shares of the Newport Beach, California-based fast-casual Mexican chain have risen 60%, easily outpacing the nearly 8% rise of the S&P 500 over the same time frame.
The stock, which reached a record high of $ 1,383.68 on September 2, has outperformed other industry leaders such as Domino's Pizza (NYSE 🙂 and McDonald's (NYSE 🙂 since the beginning of the year. Chipotle closed at $ 1,339.68 on Friday, giving it a market cap of approximately $ 37.5 billion.
After second-quarter earnings and revenue targets, Chipotle is expected to report third-quarter results on Wednesday, October 21, after the close of bubble.
By consensus estimates, the burrito chain should make a profit of $ 3.43 per share, an increase of more than 750% from earnings per share of just $ 0.40 in the previous quarter.
Revenue is expected to grow 17% quarter-over-quarter to $ 1.59 billion as consumers flocked to the digital app to deliver and collect orders amid the ongoing coronavirus pandemic.
As such, investors will keep a close eye on Chipotle's digital sales growth, which grew by a staggering 216% in the previous quarter, accounting for about 61% of total quarterly sales.
We expect Chipotle to have another impressive quarter, driven by its decision to upgrade its digital ordering infrastructure and delivery service in response to the coronavirus outbreak.
Stock To Dump: Fastly ]
Fastly (NYSE :), provider of cloud computing services, specializes in helping other companies speed up their websites, apps , video and streaming services on mobile devices. Shares of the edge cloud company lost more than a third of their value last week after warning that its third quarter results fell short of previous expectations, due to lower-than-expected demand from its largest client, social media platform TikTok.
CEO Joshua Bixby said during his company's August appeal that China-based TikTok – which President Trump has threatened to ban in the US over national security concerns – accounted for about 12% of Fastly's revenue. in the first six months of the year.
The content delivery specialist saw its stock fall 33% last week to $ 84.67, giving him a market capitalization of approximately $ 8 billion.
The stock is now down nearly 38% since it hit a record high of $ 136.29 on October 13
The San Francisco-based company – which posted massive profits of up to 530% at one point this year – said it expects Q3 revenue of about $ 70 million to $ 71 million, compared to previous forecasts by $ 73.5. million to $ 75.5 million.
"Due to the impact of the uncertain geopolitical environment, the use of the Fastly platform by the previously disclosed largest client fell short of expectations, resulting in a correspondingly significant reduction in this client's revenue," the company revealed in a provisional third. quarterly results report on October 14
It also referred to lower than expected usage of a "few" other unspecified customers.
Fastly is scheduled to publish its full third quarter results on Wednesday, October 28, after its close.
Taking all this into consideration, it appears that Fastly stocks will remain in the background for the next few days as investors brace themselves for disappointing financial results later this month.
