Stock Markets
Why Is Wayfair (W) Stock Rocketing Higher Today
Why Is Wayfair (W) Stock Rocketing Higher Today
What Happened:
Shares of online home goods retailer Wayfair (NYSE: NYSE:)
jumped 8.1% in the morning session after the company announced a significant workforce reduction as part of its efforts to optimize costs. The move involves approximately 1,650 employees, representing around 13% of its global workforce and 19% of its corporate team. The company expects this action to deliver annualized cost savings exceeding $280 million.
Wayfair’s CEO, Niraj Shah, emphasized the focus on maximizing Adjusted EBITDA and Free Cash flow. He added that, “Although persistent category weakness makes revenue growth challenging, we remain encouraged by the share gains we continue to see…Based on today’s announcement, in a hypothetical flat revenue environment – inclusive of the rebuilt roles – we would now expect to deliver over $600 million of Adjusted EBITDA in 2024.”
Given the backdrop of a tighter lending environment due to relatively higher interest rates favoring companies with solid balance sheets and ample cash to weather economic downturns, Wayfair’s move to improve its cost structure should raise investors’ optimism toward the business.
Is now the time to buy Wayfair? Find out by reading the original article on StockStory.
What is the market telling us:
Wayfair’s shares are very volatile and over the last year have had 63 moves greater than 5%. In context of that, today’s move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 2 days ago, when the company dropped 5.3% after the broader market downturn as the Dow fell for the third straight day amidst surging yields. The decline was influenced by stronger-than-expected December 2023 retail sales, up 0.6% from November 2023 (versus expectations for 0.4% growth), potentially challenging expectations of aggressive Federal Reserve rate cuts in 2024.
This marked a shift from the more optimistic market sentiment at the end of 2023, as more market data revealed inflation is cooling. However, recent market pullbacks indicate increased uncertainty in 2024, suggesting caution as stocks might be overbought.
As a reminder, the driver of a stock’s value is the sum of its future cash flows discounted back to today. With lower interest rates, investors can apply higher valuations to their stocks. No wonder so many in the investment community are optimistic about 2024. We at StockStory remain cautious, as following the crowd can lead to adverse outcomes. During times like this, it’s best to own high-quality, cash-flowing companies that can weather the ups and downs of the market.
Wayfair is down 5% since the beginning of the year, and at $55.78 per share it is trading 34.1% below its 52-week high of $84.67 from August 2023. Investors who bought $1,000 worth of Wayfair’s shares 5 years ago would now be looking at an investment worth $574.25.
Stock Markets
Palestinians say Israeli strike killed 22 in shelter, army says militants hit
By Dawoud Abu Alkas and Nidal al-Mughrabi
GAZA/CAIRO (Reuters) -Palestinians said an Israeli strike killed at least 22 people in a school sheltering displaced people in southern Gaza City on Saturday, while the Israeli military said the attack targeted a command centre of militant group Hamas.
The Gaza health ministry said most of those killed were women and children. The Hamas-run government media office said 13 children and six women were among the dead.
The military said it hit a Hamas command centre embedded in the compound that previously served as a school, repeating an accusation that the group uses civilian facilities for military purposes. Hamas denies that.
Reuters footage from the site showed blasted walls, wrecked and burnt furniture, and holes in the ceiling of one room as people tried to salvage what they could of belongings.
“The women and their children were sitting in the playground of the school, the kids were playing, and suddenly two rockets hit them,” said one witness Said Al-Malahi.
Some of the dead were wrapped in blankets and carried away on donkey carts, as ambulances transferred other bodies.
“I couldn’t take it, I did not see a single man that is injured, it was all women and children, let the Arab countries rejoice, let them rejoice and clap for (Israeli Prime Minister Benjamin) Netanyahu and the United States of America,” said another eyewitness, Ahmed Azzam, bitter that regional neighbours were not taking a tougher line against Israel.
MEDICS KILLED
In Rafah, in the southern Gaza Strip, the Gaza health ministry said four health workers were killed by an Israeli strike that hit ministry warehouses. Ambulance crews could not reach the dead or treat the wounded, it added.
In a statement, the Israeli military said forces, operating in Rafah since May, have killed dozens of militants in recent weeks and dismantled military infrastructure and tunnel shafts.
Israel’s demand to keep control of the southern border line between Rafah and Egypt has been a major sticking point in international efforts to conclude a ceasefire deal.
Hamas says it is focused on an agreement to end the war and get Israeli forces out of Gaza, while Israel says the war can only end once Hamas is eradicated. Another sticking point has been the specifics of an exchange of Israeli hostages for Palestinian prisoners held by Israel.
This war in the decades-old Israeli-Palestinian conflict was triggered on Oct. 7 when Hamas attacked Israel, killing 1,200 people and taking about 250 hostages, according to Israeli tallies.
Israel’s subsequent assault on the enclave has killed more than 41,000 Palestinians, according to the local health ministry, and displaced nearly the entire 2.3 million-strong population.
(Reporting and writing by Nidal al-Mughrabi; Additional reporting by Dawoud Abu Alkas in Gaza, Adam Makary in Cairo and Ali Sawafta in Ramallah; Editing by Andrew Heavens and Andrew Cawthorne)
Stock Markets
Trump to visit North Carolina as scandal swirls around Republican ally
By James Oliphant
(Reuters) – Republican presidential candidate Donald Trump will not be joined by his party’s embattled pick for North Carolina governor when he visits the critical electoral state on Saturday, the Trump campaign said.
Trump previously endorsed Mark Robinson, who was the subject of an explosive CNN report this week that he once called himself a Black Nazi and proposed bringing back slavery in comments posted on a pornography website.
Robinson, the state’s lieutenant governor, denied the allegations and has said he will remain in the governor’s race. His campaign could not be reached for comment.
Some Republicans fear his candidacy in one of the country’s highest-profile down-ballot races this year could damage Trump’s chances in the battleground state, where polls show Trump essentially tied with Democratic rival Kamala Harris ahead of the Nov. 5 election.
Ahead of Trump’s afternoon rally in Wilmington, North Carolina on Saturday, the Democratic National Committee launched new advertising across the cities of Raleigh, Charlotte and Greensboro tying the former president to Robinson.
The billboard ads show a photo of the two men together, along with direct quotes from Trump previously calling Robinson an “outstanding person” and an “incredible gentleman.”
The Harris campaign also began running a TV ad in the state on Friday featuring Trump’s past praise for Robinson.
In March, Trump called Robinson “Martin Luther King on steroids” after Robinson delivered remarks in Greensboro, and Robinson appeared at a Trump event as recently as last month. Robinson would be the state’s first Black governor if elected.
Robinson has a history of inflammatory rhetoric, at times referring to Muslims as “invaders” and calling gay and transgender people “filth.” He has made comments denying the Holocaust.
Trump has yet to address the latest allegations against Robinson. One Trump adviser, who asked not to be named, said Trump should stay silent and not fan the controversy.
“Ignore it, and let it die,” the adviser said.
Trump’s campaign did not respond to a request for comment.
Harris’ campaign and its allies have made a significant investment in North Carolina, including two stops by the vice president last week. A Democratic presidential candidate has not won the state since 2008, but voters elected Democrat Roy Cooper as governor in 2016 and 2020.
Robinson had been trailing his opponent, Democrat Josh Stein, even before the CNN report, suggesting that he could be a drag on Trump’s chances in the state if some disaffected Republicans stay home on Election Day or defect to Harris.
Chris Cooper, a professor of political science at Western Carolina University, said in a state that Trump won by just 1.3 percentage points in 2020, the Robinson scandal could damage Republicans’ chances up and down the ballot in November, including Trump’s.
“If some people feel that the Republican brand is stained enough that they’d rather stay home, then that’s going to matter,” Cooper said. “It doesn’t take a big difference to flip the state.”
Thom Tillis, a Republican U.S. senator from North Carolina, responded to the allegations against Robinson by telling voters on X that “we must focus on the races we can win,” citing the presidential contest but omitting the gubernatorial vote.
“If Harris takes NC, she takes the White House,” Tillis wrote. “We can’t let that happen.”
Stock Markets
GM to begin laying off about 1,700 workers at Kansas plant, WARN notice shows
(Reuters) – General Motors (NYSE:) will begin laying off 1,695 workers at its Fairfax Assembly plant in Kansas, the company said in a Worker Adjustment and Retraining Notification (WARN) notice earlier this week.
The first of two rounds of layoffs will begin Nov. 18 and will include the temporary layoff of 686 full-time workers and the termination of 250 temporary employees, Automotive News reported on Saturday citing a company filing to the state of Kansas.
Starting Jan. 12, 759 full-time workers will be temporarily laid off, the report added.
GM did not immediately respond to a Reuters request for comment on the details of the latest layoffs.
Earlier in May, GM had said that it would pause production of the Cadillac XT4 after January 2025 in Kansas, resulting in layoffs of production employees until production resumes in late 2025 for both the Bolt EV and XT4 on the same assembly line.
The company had also said in August that it was laying off more than 1,000 salaried employees at its software and service units worldwide.
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