3 Stocks to Watch in June

3 Stocks to Watch in June

Posted On June 5, 2019 2:26 pm

June is a typically slow month for the stock market. Earnings season has come and gone, and the average American has their mind on summer vacation rather than their 401(k).

Still, market news never stops, and recent months have been chock-full of fodder, including a slew of IPOs, trade tensions with China, and musings that the Federal Reserve could actually start lowering rates after hiking them as recently as last December.

Even a sluggish month doesn’t stop individual stocks from making big moves, as earnings reports and other announcements keep coming. Keep reading to see why  Stitch Fix (NASDAQ:SFIX)Beyond Meat (NASDAQ:BYND), and Constellation Brands (NYSE:STZ) all deserve your attention over the coming weeks as they prepare for earnings reports and other key investor updates.

Stitch Fix comes under the needle

Stitch Fix, the online styling service, has been one of the more controversial stocks since it debuted on the market in November 2017. Shares surged last summer to more than $50, but promptly gave up those gains after active user growth suddenly slowed. Since that peak, the stock has fallen more than 50%, and today trades near $23.

Stitch Fix shares have moved by 20% or more in each of its last four earnings report, so there’s good reason to expect another big swing when the company reports third-quarter earnings after hours on June 5.

Investors will want to keep their eye on the usual themes, including active user growth and top- and bottom-line growth, but there are also some new items to keep an eye on, including tariffs and the company’s recent expansion in the U.K.

Though clothing is not included in the current round of Chinese tariffs, the Trump administration has warned that it could slap import taxes on a new round of goods, including apparel. Other retailers have already warned of the impact of tariffs, saying they’ll lead to higher prices, and such a headwind could be damaging to the prospects of a growth company like Stitch Fix. Expect some commentary from management on tariffs on the earnings call.

Elsewhere, the company made its first international launch last month, entering the U.K., a market that has historically been ahead of the U.S. in online clothing shopping. Success there could lead to further expansion, so investors will want to pay attention to management’s thoughts on that subject.

Stitch Fix’s guidance called for revenue of $388 million to $398 million, up 22% to 26% in the quarter, and adjusted EBITDA of -$4 million to $1 million, so investors should measure the performance according to that yardstick.

Beyond Meat looks for seconds

Few stocks have dazzled this year like Beyond Meat, the maker of alternative plant-based foods like the Beyond Burger, whose shares have jumped more than 300% from its IPO price of $25 to more than $100.

The high-flying food stock will get its first test as a publicly traded company when it reports earnings after hours on…

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