What happened
iRobot (IRBT +0.00%) stock outperformed a booming market last month by rising 16% compared to a 3% spike in the S&P 500, according to data provided by S&P Global Market Intelligence.
The rally only erased a portion of shareholders' 2019 losses, though, as shares ended up lower by 40% compared to the market's 29% spike.
Image source: Getty Images.
So what
Investors reined in their pessimism on the consumer-focused business for a few reasons last month, including the prospect of progress in the trade war between the U.S. and China. That optimism coupled with indications of strong holiday shopping trends to suggest a brighter future for the robotic cleaning device specialist, which struggled under debilitating cost increases for most of 2019.
Now what
iRobot is giving an investor presentation on Jan. 14, at which time management might issue an update on sales trends over the critical holiday shopping period. The growth stock cut prices just ahead of that season in hopes of protecting market share, and that move might have boosted revenue in recent weeks. Yet a strong finish to 2019 would mark just the first step in a longer rebound plan that includes diversifying its production footprint to markets outside of China so that the company is no longer exposed to trade spats with a single country.
