Stitch Fix stock surges on strong quarterly earnings report
Stitch Fix Inc., the apparel company that uses software to predict what customers want, surged after posting earnings results that beat estimates and issuing a better-than-expected sales forecast for the current quarter.
The stock jumped as much as 25% in after-hours trading after Stitch Fix reported fiscal second-quarter adjusted profit of 12 cents per share on sales of $370.3 million. Both exceeded the highest analyst estimates compiled by Bloomberg.
Stitch Fix also projected third-quarter sales that topped the average estimate and said that active clients rose to 3 million during the quarter, an increase of 18% compared with the same period last year.
Interest from short sellers in Stitch Fix had inched up over the last week, with about 33% of shares available to borrow on loan to short sellers on Monday, according to S3 Analytics data. That’s up from 31% a week ago.
Wall Street has grown less bullish on the company over the last six months as the stock lost more than two-thirds of its value. Three of the 11 analysts covering the company have a buy rating, compared with about half in September, according to Bloomberg data.
Investors had been bracing for a big move after the earnings report, with the options market implying a swing of as much as 18%.
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