Earnings season is often a time of big moves for stocks. A lot of companies see their shares shoot higher or lower as fresh financials come out, and we had hundreds of stocks hitting new 52-week highs this week.
Sirius XM Radio
Satellite radio is still growing in popularity despite a growing volume of app-based competition in connected cars. Sirius XM closed out the year with a record 34.9 million total subscribers. Sirius XM is finding a way to grow despite weakening new car sales and a trend among millennials to steer away from vehicle ownership.
Sirius XM still hit a new 52-week high hours after posting its financial results, a surprising move since the report itself wasn't that great. The $8.1 billion in revenue Sirius XM is targeting for 2020 is below where analysts were perched and represents full-year growth of less than 4%. The 900,000 Sirius XM is forecasting in self-pay net additions for 2020 would also break a streak of 10 years in a row of topping a million net adds. Sirius XM has historically been conservative with its guidance, and the bullish reaction to the uninspiring outlook suggests that investors are trying to get a step ahead of the feigned pessimism.
The market for home audio gadgetry is becoming crowded with consumer tech giants flooding the marketplace, but pioneer Sonos is still finding a way to stand out. Sonos moved sharply higher after posting better-than-expected results for its fiscal first quarter. Double-digit growth in revenue and earnings was a refreshing surprise, especially on the bottom line, where analysts were betting on a decline in profitability.
Sonos has come through 14 consecutive years of positive revenue growth, and it's well on its way to extending that run to another year. The strong report is ultimately a great recovery from a couple of miscues in recent weeks where it angered longtime customers by originally threatening to brick their legacy devices, and then an errant employee leaked hundreds of customer email addresses. Leave it a strong quarter to turn the volume knob higher again.
Mobile gamers are fickle, but Zynga is finding a way to keep its players engaged and growing in number. Revenue and bookings soared better than 60% in this week's fourth-quarter report. It essentially broke even on the bottom of its income statement, but Wall Street was bracing for a larger deficit.
Zynga's guidance calls for top-line growth to slow to 21% in 2020, but it's hard to complain about the deceleration. Most app publishers would love to be growing at that pace.
Their double-digit revenue gains make Sirius XM, Sonos, and Zynga all growth stocks earning this week's fresh highs.