Stocks ended their best first half in decades with a day of small gains, led by the financial and energy sectors. The Dow Jones Industrial Average (DJINDICES:^DJI) is up 13.9% so far in 2019. The S&P 500 (SNPINDEX:^GSPC) is up 17.1% for the year, having had its best June performance since 1955.
Today's stock market
|Index||Percentage Change||Point Change|
RealReal shines in its public debut
The RealReal, an online consignment seller of luxury goods, went public today and investors snapped up the shares, which closed 44.5% above the offering price. The company offered 15 million shares at $20 each, and at market close the company was valued at about $2 billion.
RealReal could be considered the eBay of used luxury items such as jewelry, watches, handbags, shoes, and art. What distinguishes the company's service is that items for sale are authenticated by the company's trained experts, eliminating counterfeits and fakes. The company had $711 million in gross merchandise volume in 2018, collecting $207 million in revenue, a 55% increase from the year earlier.
RealReal is really, really unprofitable, losing $23.3 million on revenue of $69.3 million in the first three months of 2019. But the number of active buyers grew almost 10% from the previous quarter to 456,000, and investors who themselves may not be willing to be caught dead in last year's Prada were finding that kind of growth quite fashionable today.
Beer sales boost Constellation Brands
Constellation Brands beat expectations for its fiscal first quarter and raised guidance for the year, causing shares to jump 4.6%. Net sales were up 2% to $2.1 billion, a bit above expectations of $2.08 billion. Comparable earnings per share, excluding an equity loss on the company's investment in Canopy Growth, grew 9% to $2.40.
Modelo and Corona brands propelled beer sales, which were up 7.4% on an increase in depletion volume -- the sales from distributors to retail locations -- of 6.6%, a decline from the 8.1% depletion growth last quarter. Sales of wine and spirits fell 7.8%.
A delay in closing Constellation's sale of some wine brands to Gallo will actually boost full-year sales and profit over earlier expectations. The company raised 2020 comparable earnings guidance to a range of $8.65 to $8.95, compared with the $8.57 analysts had been expecting.
While expressing disappointment with Canopy Growth's latest quarter, Constellation praised the company's deal with Acreage Holdings, and is looking forward to Canopy's sales of vapes, beverages, and edibles in Canada, as well as CBD products in the U.S., in Q4 this year.