Please ensure Javascript is enabled for purposes of website accessibility

Why Stitch Fix, Inc. Stock Popped 44.6% in June

By Steve Symington - Jul 6, 2018 at 9:00AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The online personal styling service soared after a great quarter. Here's what investors need to know.

What happened

Shares of Stitch Fix (SFIX 2.66%) skyrocketed 44.6% in the month of June, according to data from S&P Global Market Intelligence, after the personalized apparel specialist announced significantly stronger-than-expected quarterly results. To be sure, Stitch Fix stock jumped more than 26% on June 8, 2018, alone, the first trading day after its stellar fiscal third-quarter 2018 report was made available to investors.

Stitch Fix box sitting on a doorstep against a bright yellow door


So what

More specifically, Stitch Fix's revenue last quarter climbed 29% year over year to $316.7 million, and translated to net income of $9.5 million, or $0.09 per diluted share (swinging from a loss of $0.38 per share in the same year-ago period). By comparison, most investors were only looking for earnings of $0.03 per share on revenue of $306.5 million. 

The underlying drivers of Stitch Fix's results were also encouraging; active clients increased 30% year over year to 2.7 million, and the company further stoked the fire by announcing it would soon launch Stitch Fix Kids, marking a logical expansion of its increasingly popular core business.

Now what

For any investors who doubt whether such a pronounced pop was merited, we should also keep in mind that Stitch Fix stock had only just fallen 17% in the month May, namely as investors seemed to balk at a pair of shareholder presentations that, incidentally, should have instead served to help them better predict the company's impending outperformance. If Stitch Fix is able to sustain this business momentum as it moves into new markets, I suspect its recent gains will only represent the beginning of a much longer trend.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

StitchFix Stock Quote
$6.18 (2.66%) $0.16

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/25/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.