Stitch Fix, DocuSign, Netflix and more
Netflix’s announcement that it had lost 200,000 subscribers during the first quarter added pressure to an already struggling tech sector. But Mark Mahaney, a top tech analyst believes there are several opportunities for investors given the sector’s current weakness.
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Below are the headline stocks for Friday, June 10, 2010.
Stitch Fix – The clothing retailer dropped 14% after Stitch Fix said it expected revenue to decline in the fiscal fourth quarter and announced layoffs. It said that the company expected to reduce its costs by between $40 million- $60 million during the 2023 fiscal year. According to Refinitiv, Stitch Fix’s revenue for the third quarter was $493 million. This is in line with expectations.
DocuSign – Shares of the electronic signature software vendor dropped a whopping 24% after the company reported weaker-than-expected earnings in its fiscal first quarter. According to Refinitiv, both earnings per share as well as revenue were below analysts’ estimates. DocuSign experienced a 25% increase in revenues compared with a year prior, but investors worry more about profitability. It was also hit by three. downgradesFrom Wall Street analysts.
Illumina – The biotech stock dropped more than 9% after Illumina announced that its chief financial officer will leave next month. Sam Samad is the current chief financial officer and will be taking a similar position at Quest Diagnostics.
Kontoor Brands – Shares of the apparel brand sank 4.3% following a downgrade from Goldman Sachs. Kontoor might feel margin pressure due to rising wholesale prices and decreasing costs, according to an investment firm.
Roblox – Shares of the gaming company fell nearly 8% after Goldman Sachs downgraded Roblox to sell from neutral. “We have increasing concerns around the post-pandemic environment and expect a continuation of slowing growth, tough comps, & normalization of margins in the near-term,” Goldman said.
IHeartMedia –The radio stock tanked 9% following a downgrade from Morgan Stanley. According to Morgan Stanley, the investment bank pointed out that the stock could be affected by structural problems in iHeart’s core business as well as a possible recession.
Spirit Airlines – Shares of Spirit Airlines rose 2.6% after JPMorgan upgraded the stock to overweight. In a note sent to clients, JPMorgan stated that it believes a merger of Spirit Airlines and another airline will be a good option. JetBlue and Frontier made offers for Spirit. However, it remains to be seen if the Department of Justice approves an airline merger.
eBayAfter Goldman Sachs, the shares of the ecommerce firm fell by more than 4 percent downgraded the stock to sell from neutral. Wall Street’s firm stated that it perceives revenue growth as a risk due to the pressure on global consumers. Goldman also mentioned eBay’s excessive exposure to foreign markets, and the failure of its growth strategies.
— CNBC’s Yun Li, Samantha Subin and Hannah Miao contributed to this report.