What happened

Shares of Wayfair (NYSE:W) outpaced the market by a wide margin last month, gaining 22% compared to an 8% spike in the S&P 500, according to data provided by S&P Global Market Intelligence.

The rally returned the home furnishings e-commerce specialist to market-thumping status, with shares up 24% in the past year compared to a 2% decline in the broader market. 

A modern furnished living room.

Image source: Getty Images.

So what

January's bounce appeared to be driven by broader moves in the stock market. After all, Wayfair stock sank in the prior month as investors sold off shares of individual stocks that had posted big gains through most of 2018. The stock was hit hard during the sharp December drawdown on fears that a global recession might compress valuations for high-growth companies. Investor opinions shifted dramatically in the following month, with stocks posting their best January in over three decades. Wayfair benefited to an outsize degree.

Check out the latest Wayfair earnings call transcript.

Now what

The company is set to post earnings results for the key holiday shopping period on Feb. 22. Investors already know that sales growth was strong, but we'll find out at that point whether Wayfair had to engage in deep discounting to keep its top line moving higher.

Looking further out, management's 2019 forecast should reflect executives' optimistic market outlook as Wayfair expands into new countries and product niches. Ideally, that growth will be balanced by a step toward profitability following several consecutive years of net losses.