Shares of online home-goods retailer Wayfair (NYSE:W) were trading higher on Wednesday afternoon, as the company geared up for a major Fourth of July sale. As of 3 p.m. EDT, Wayfair's shares were up about 12% from Tuesday's closing price.
Despite a steep decline in March amid the outbreak of COVID-19 in the United States, Wayfair's stock has gained more than 140% since the beginning of 2020.
There was no major business news driving Wayfair's shares higher on Wednesday. The company is aggressively promoting a "July 4th Clearance Sale," with heavy discounts on outdoor furniture, appliances, and other products; it's possible that some investors are bidding up the stock in anticipation of a successful holiday weekend.
Stepping back a bit, I wonder if the rising rates of COVID-19 infections in parts of the U.S. that reopened early are spurring investor interest in the company. Wayfair, which makes nearly all of its sales online -- the company has just two physical stores, one of which is an outlet -- saw its business boom during the early weeks of the pandemic, when millions of consumers were stuck at home.
So why is the stock up today? It's possible that consumer-discretionary investors are pricing in the possibility of a second wave of shelter-at-home orders in some parts of the U.S., and betting that cooped-up consumers might give Wayfair another sales boost in the weeks to come.
Investors will have to wait a few more weeks for an update on the company's recent sales and outlook. While Wayfair hasn't yet announced a date for its second-quarter earnings report, it has reported in early August in each of the last three years.