Costco, Thor, Autohome, Momo Headline Wednesday’s Investing Action Plan – Investor’s Business Daily

Here’s your Investing Action Plan for Wednesday: what you need to know as an investor for the coming day.

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Look for more results to be posted from major U.S. retailers, including Costco (COST) and Dollar Tree (DLTR), and Chinese internet names Autohome (ATHM) and Momo (MOMO). Plus, another Beige Book report is due from the Fed, which will provide insights into current economic conditions.

Autohome

The auto site for China consumers reports fourth-quarter results before the open.

Estimates: A 47% EPS bump to 69 cents, while revenue slides 7% to $268.6 million.

Stock: Shares were up 1.1% at 80.76 on the stock market today and have found support at their 50-day moving average, bouncing off the key level twice in recent weeks.

Momo

The mobile social networking platform discloses Q4 results in the morning.

Estimates: An EPS uptick of 2% to 42 cents per ADS on a 57% pop in revenue to $386 million.

Stock: Shares climbed 1.7% to 33.85, hitting resistance at their 200-day line, although they retook support at their 50-day line in recent weeks.

Autohome and Momo’s China-based peers have been swinging in various directions on earnings results, with YY.com (YY) sliding on disappointing revenue guidance and Baozun (BZUN) surging after a well-received quarterly beat.

Dollar Tree

Expect to hear from the dollar-store chain in the morning.

Estimates: Profit to grow 37% to $1.90 per share in Q4 as revenue rises 14% to $6.4 billion. Consensus Metrix expects 2.8% same-store sales growth, including 4% comps from flagship Dollar Tree stores and 1.5% comps from Family Dollar locations.

Stock: Shares were up 1.5% at 103.82 but have hit resistance at their 50-day moving average after breaching the key level in early February.

Analysts have pointed to dollar stores’ resilience against online stores of Amazon’s ilk, thanks to their reach into more rural areas and potential consumer benefits from tax reform.


IBD’S TAKE: Buying or holding a stock can be risky heading into an earnings report. Here’s an earnings options strategy that can help you cash in on post-earnings stock gains, while minimizing the risk from a weak quarter.


Costco

The membership-based warehouse reports after the closing bell.

Estimates: Earnings to rise 24% to $1.45 per share on 10% sales growth to $32.71 billion.

Core same-store sales, minus gas and the impact of foreign exchange, are expected to rise 5.5%, per Consensus Metrix. Including those elements, analysts are expecting comp growth of 7.5% globally.

Stock: Costco dipped 0.2% to 191.18, developing a flat base as it bobs around its 50-day line.

Costco’s results come amid a backdrop of battling among the major retailers: namely, Walmart (WMT) and Amazon (AMZN). Both are working hard to get products to shoppers faster, and Walmart’s Sam’s Club, a rival to Costco, has joined forces with Instacart to offer same-say delivery.

Thor Industries

The RV maker releases Q2 results after the close.

Estimates: EPS to grow 45.5% to $1.79 on 20% revenue gains to $1.91 billion.

Stock: Shares climbed 2.2% to 121.43 but have breached support at both their 50-day and 200-day lines, the former in January and the latter just a few sessions ago.

RV peer Winnebago (WGO) took a similar hit after Northcoast Research said in late January that dealer inventory is at an “unsustainable level” for 2018.

Beige Book

The Federal Reserve’s survey of regional business and economic conditions will come out at 2 p.m. ET. Given the market’s sensitivity to news about inflation, look for any additional signs of faster price and wage growth, especially now that tax cuts have started filtering through to workers’ paychecks. Also be on the lookout for more clues on capital investment.

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