Why Did GoPro Rise Over 12% and RH Surge Over 40%?

TL;DR

GoPro rose over 12% after signaling revenue near the high end of its guidance and expected non-GAAP profitability for the quarter, while RH surged over 40% after beating second-quarter earnings, revenue, and same-store sales expectations. The discussion also covers GoPro’s recent revenue growth and other major market moves, making it worth reading on for the specific figures behind both rallies.

Transcript

howdy there ladies and gentlemen today what if I really talk like that what is going on guys GoPros up huge today RH absolutely exploded today why the heck did these stocks go up so much GoPro went up over 12% today very good day for GoPro but that looks like a joke compared to our H which went up over 40% today guys we got to talk about these now ... Read More

Key Insights

• 💰 RH's stock had an exceptional gain of 40% without any acquisition, which is uncommon for a billion-dollar company.
• 😮 GoPro's stock price performance is often volatile, but their positive revenue guidance and expected profitability for the quarter contributed to the stock's rise.
• 🥺 Strong earnings reports and positive financial results can lead to significant stock price gains.
• ❓ Other stocks, like Cabela's and Fitbit, experienced notable increases in stock price despite an overall down market.

Questions & Answers

Q: Why did GoPro stock rise over 12%?

GoPro indicated that revenue would probably reach the high end of its guidance and that it should be profitable on a non-GAAP basis for the quarter. Those announcements helped drive the stock’s gain of more than 12%.

Q: Why did RH stock surge over 40%?

RH reported second-quarter adjusted earnings of 65 cents per share on revenue of $615 million. Both figures exceeded expectations, and same-store sales also grew faster than expected, contributing to the stock’s move of more than 40%.

Q: How did RH’s results compare with market expectations?

RH posted adjusted earnings of 65 cents per share versus an expected 47 cents. Revenue reached $615 million compared with the expected $606 million, while same-store sales rose 7% versus approximately 5.4% expected.

Q: Was RH’s 40% gain caused by an acquisition?

No acquisition was announced in the transcript. The speaker initially suspected a buyout because a 40%-plus daily move was highly unusual for RH, which he described as a company with a market capitalization in the billions.

Q: What recent revenue growth did GoPro report?

The speaker cited three consecutive quarters of revenue growth: 23%, 19%, and 34% in the latest quarter. He also expected growth of more than 20% in the current quarter.

Q: What profitability outlook was discussed for GoPro?

GoPro was expected to be profitable on a non-GAAP basis in the current quarter. The speaker also said it was expected to be GAAP profitable in the fourth quarter and overall in 2018.

Q: What resource was recommended for GoPro investors?

The speaker recommended listening to the investor presentation available on GoPro’s website. He said the company executive presenting communicated with investors simply and confidently.

Q: What other stocks made notable moves that day?

The speaker said Fitbit rose more than 10%, Cabela’s gained about 14%, and Snapchat increased 5%, despite the broader market being slightly down. Disney moved the other way, falling about 5%.

Summary & Key Takeaways

• GoPro's stock went up because they announced they will hit the high end of their revenue guidance and are expected to be profitable. The stock has shown consistent growth and strong revenue numbers.

• RH, a billion-dollar company, saw a 40% increase in stock price with no acquisition. Their strong earnings beat expectations, with higher revenue and same-store sales growth.

• Other stocks, like Cabela's and Fitbit, also saw significant gains, while Disney had a bad day with a 5% decrease in stock price.