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Why AutoZone, Movado Group, and RH Jumped Today

By Dan Caplinger – Dec 4, 2018 at 11:30AM

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Strong fundamental performance kept these companies from falling with the overall market.

Tuesday was a scary day on Wall Street, with the Dow Jones Industrial Average falling by as much as 800 points and finishing near its worst levels of the session. The S&P 500 and Nasdaq Composite saw similar losses of around 3%-4% as market participants worried about the possibility of failure for the U.S. and China to reach a resolution of trade problems within their new 90-day cooling period. At the same time, nervousness about a slowing economy raised concerns of a potential recession. Yet some individual stocks still reacted well to positive earnings news, and AutoZone (AZO 2.16%), Movado Group (MOV 0.77%), and RH (RH 2.49%) were among the best performers on the day. Here's why they did so well.

AutoZone drives ahead

AutoZone shares climbed 7% after the company reported results for the first quarter of its 2019 fiscal year. The auto parts giant said that total revenue rose 2% on a 2.7% increase in same-store sales in the U.S., helping to power earnings per share higher by more than a third compared to year-earlier figures. CEO Bill Rhodes was especially pleased at how well the company managed to do because the previous year's fiscal first quarter had been especially strong, with victims of three major hurricanes in 2017 needing to purchase parts and accessories quickly to have their vehicles repaired. With the company still buying back stock, AutoZone shareholders are optimistic about the parts retailer's future.

Close-up of a car's front left tire in motion next to a yellow line in the road

Image source: Getty Images.

Movado hits the mark

Movado Group saw its stock jump nearly 13% following the release of its third-quarter report. Revenue for the watchmaker rose 10%, with adjusted earnings also climbing double-digit percentages as Movado made progress on multiple fronts. Between the recent acquisition of upstart watchmaker MVMT and solid organic growth both in the U.S. and internationally, CEO Efraim Grinberg hopes that Movado can build brand traction with millennial shoppers. For a retailer that struggled for quite a while, Movado's recovery is nice for shareholders to see, and there's more potential for gains ahead if the company can keep up its newly found momentum.

RH looks fashionable

Finally, RH shares finished higher by about 11%. The luxury home furnishings retailer said that revenue climbed 7% during its third quarter, supported by a 4% rise in comparable-brand sales. A combination of pricing discipline, cost controls, and smart strategic thinking helped contribute to RH's success, and CEO Gary Friedman hailed the moves that the company has made to focus on its best opportunities while staving off e-commerce competition. Despite some concerns about the extent to which RH has financed stock buybacks through raising debt, shareholders nevertheless seem happy with the way that the retailer has found its way back from tough times in recent years.

Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool recommends RH. The Motley Fool has a disclosure policy.

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