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Pre-Market Stock Movements: Spotlight on Capri, Tapestry, AppLovin, Disney, and More
Capri and Tapestry Experience Significant Market Shifts
In the pre-market trading scene, Capri and Tapestry made significant moves. Capri saw a remarkable increase of over 57%, while Tapestry experienced a 3.2% slide. These movements came in the wake of the announcement by luxury company Tapestry, the powerhouse behind brands such as Coach and Kate Spade, that it plans to acquire Capri Holdings in a deal estimated at around $8.5 billion. Capri Holdings is the parent company of renowned brands like Versace, Jimmy Choo, and Michael Kors.
AppLovin's Impressive Performance
AppLovin, a leading game developer, saw its shares surge by 25.8% in early morning trading following the company's strong second-quarter results and optimistic revenue guidance for the third quarter. The company anticipates revenue between $780 million and $800 million for the third quarter, surpassing analysts' expectations of $741 million. AppLovin also reported earnings of 22 cents per share for the second quarter, significantly higher than the 7 cents expected by analysts, according to Refinitiv.
Sonos, Alibaba Group, and Wynn Resorts Beat Expectations
Sonos, the wireless speaker manufacturer, saw its shares rise by 5% after surpassing analysts' predictions in its latest quarterly results. The company reported a loss of 18 cents per share on revenue of $373 million for its fiscal third quarter, beating analysts' expectations of a 20 cent loss per share on revenue of $334 million. Sonos also raised its full-year EBITDA guidance.
Alibaba Group and Wynn Resorts Outperform
Shares of Alibaba Group, listed in the U.S., rose by 3.8% after the Chinese tech giant exceeded analysts' expectations in its quarter ending June. The company reported non-GAAP per-share diluted earnings of CNY17.37, higher than the consensus estimate of CNY14.59, according to StreetAccount. It also posted revenue of CNY234.16 billion, surpassing the CNY224.75 billion forecast.
Wynn Resorts, the casino operator, gained 2.2% after exceeding expectations for its second quarter on both the top and bottom lines. The company reported adjusted earnings of 91 cents per share on revenue of $1.6 billion, surpassing the 59 cents on revenue of $1.54 billion anticipated by analysts polled by Refinitiv.
Disney, Trade Desk, Six Flags Entertainment, and Illumina Make Moves
Shares of media giant Disney gained about 2% in premarket trading following the company's announcement that it would increase the price of its ad-free streaming tier in October and implement measures to crack down on password sharing. However, Disney reported a 7.4% decline in subscriber count last quarter and recorded $2.65 billion in one-time charges and impairments, leading to a rare quarterly net loss.
Trade Desk, Six Flags Entertainment, and Illumina
Shares of advertising technology company Trade Desk moved up less than 1% after a second-quarter report that beat expectations on both the top and bottom lines. The company generated 28 cents in adjusted earnings per share on $464 million of revenue, surpassing analysts' expectations of 26 cents per share on $455 million of revenue. The company also projected third-quarter revenue of at least $485 million, above the $480 million projected by analysts.
Shares of amusement park company Six Flags Entertainment slid 3% after the company reported second-quarter earnings that missed estimates. The company reported earnings of 25 cents per share on revenue of $444.0 million, falling short of analysts' expectations of earnings of 78 cents per share on revenue of $459.0 million.
DNA sequencing company Illumina saw its shares drop 4.6% after issuing weaker-than-expected guidance. While the company surpassed expectations for the second quarter, it anticipates some weakness in the second half of the year due to a slow recovery in China and a more cautious consumer. Illumina forecasts full-year revenue to rise 1% year over year, lower than the 7.1% rise analysts polled by Refinitiv were anticipating.
Hot Take: Implications of Pre-Market Stock Movements for New Businesses
The recent pre-market stock movements of companies like Capri, Tapestry, AppLovin, and Disney provide valuable insights for new businesses. These market shifts underscore the importance of strategic acquisitions, strong quarterly results, and accurate revenue guidance in influencing stock performance.
Lessons from Capri, Tapestry, and AppLovin
The significant increase in Capri's stock following Tapestry's acquisition announcement highlights the potential value of strategic partnerships and acquisitions for new businesses. Meanwhile, AppLovin's impressive performance, driven by strong second-quarter results and optimistic revenue guidance, underscores the importance of meeting and exceeding financial expectations.
Takeaways from Disney, Trade Desk, and Illumina
Disney's share increase, despite a decline in subscriber count, demonstrates that strategic initiatives, such as price adjustments and measures to curb password sharing, can positively influence stock performance. Trade Desk's experience shows that surpassing financial expectations can lead to positive stock movements. Conversely, Illumina's share drop following weaker-than-expected guidance illustrates the potential negative impact of underwhelming future prospects.
Conclusion: Navigating the Stock Market
In conclusion, new businesses can learn valuable lessons from these pre-market stock movements. By focusing on strategic growth initiatives, meeting financial expectations, and providing accurate future guidance, businesses can effectively navigate the stock market and potentially influence their stock performance.
Article First Published at: https://www.cnbc.com/2023/08/10/stocks-making-the-biggest-moves-premarket-capri-tapestry-applovin-disney-and-more.html
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