Stocks fluctuated on Thursday, but closed generally higher. The Dow Jones Industrial Average (DJINDICES:^DJI) set another record, and the S&P 500 (SNPINDEX:^GSPC) had a small gain.

Today's stock market

Index Percentage Change Point Change
Dow  0.35% 81.25
S&P 500  0.02% 0.49

Data source: Yahoo! Finance.

The financial sector rallied on the nomination of Jerome Powell to take over as chairman of the Federal Reserve, with the Financial Select Sector SPDR ETF (NYSEMKT:XLF) closing up 0.94%. Retail stocks also rallied; the SPDR S&P Retail ETF (NYSEMKT:XRT) was up 1.21%.

As for individual stocks, Wayfair (NYSE:W) plummeted on profit concerns, and AutoNation (NYSE:AN) soared after beating profit estimates and announcing a deal to service autonomous vehicles. 

Abstract picture of stock prices and graphs.

Image source: Getty Images.

Wayfair stock retreats on larger-than-expected loss

Online furniture retailer Wayfair reported third-quarter results Thursday morning that were more or less in line with revenue expectations, but fell short on the bottom line, and the stock tumbled 16%. Revenue increased 39% to $1.20 billion and non-GAAP earnings were a loss of $0.65 per share. Analysts were expecting a loss of $0.46 on revenue of $1.21 billion.

To be fair to Wayfair, the results exceeded revenue guidance the company gave three months ago, and profits fell within the forecast. Company officials predicted revenue to be between $1.155 billion and $1.185 billion, and said adjusted EBITDA margin would fall between negative 1.7% and negative 2%. That metric came in at negative 0.9%. 

Wayfair continues to acquire new customers at a rapid rate, and existing customers are giving it more repeat business. Active customers increased 39.2% to 10.3 million and orders per customer increased from 1.69 to 1.75. Repeat customers placed 2.9 million orders, an increase of 48.2% from Q3 last year.

Wall Street's expectations had apparently gotten ahead of reality for Wayfair, as the company continues to invest in advertising and international expansion in order to keep up its torrid sales-growth pace. Thursday's drop wiped out six months of stock gains, but shares are still up 70% for the year.

AutoNation beats on profit, announces self-driving car deal

AutoNation, the largest automotive retailer in the U.S., reported revenue that missed estimates but earnings per share that exceeded them, and announced a multiyear agreement with Alphabet to service its Waymo unit's fleet of self-driving cars. The stock jumped 15% on the news.

Revenue fell 2.4% to $5.43 billion, and earnings per share were $1.00, compared with $1.05 last year, and would have come in at $1.08 if it weren't for Hurricane Irma. The analyst consensus was for the company to earn $0.84 per share on revenue of $5.58 billion. Comparable store unit sales rose 2%, an improvement from last quarter. Net income fell 9.1%, but the company bought back a whopping 9.2 million shares of its stock in Q3 -- 9% of the shares outstanding at the beginning of the quarter -- at an average price of about $43.

Under the deal with Alphabet, AutoNation will support Waymo's fleet of self-driving Chrysler Pacifica hybrid minivans; the agreement will expand as Waymo adds more models to its fleet. AutoNation will provide long-term vehicle maintenance and repairs, and "strategic capabilities to maximize the life of Waymo's vehicles across the United States," according to the press release.

The agreement caught the fancy of investors in much the same way that an earlier agreement with Avis for fleet management boosted that company's stock 14% on the day it was announced. The financial impact in the near term will be negligible for AutoNation, but the possibility of its profiting in the longer term from the autonomous vehicle trend was enough to get investors to step on the gas Thursday.

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