What happened

Shares of home decor retailer At Home Group (HOME) got crushed on Wednesday after the company reported earnings for the second quarter of its fiscal 2021. While both the top and bottom lines showed robust growth, there's reason to believe these results were already priced into the stock, and investors had already turned their attention to the rest of 2020.

As of 11:20 a.m. EDT today, At Home Group stock was down a painful 26%. But if you bought at April's lows, you likely don't care: Even with today's loss, shares are still up about 1,000%.

HOME Chart

HOME data by YCharts.

So what

For Q2, At Home Group's net sales grew 51% year over year to $515 million. Comparable-store sales (at stores opened over 15 months) were up 42%. And net income surged to $89 million, up from just $10 million last year.

Those numbers are all great, but none were unexpected. At Home Group had already released preliminary Q2 results on July 29, and revenue results aligned perfectly with the preliminary announcement. Net income was up slightly from preliminary results of $82 million. At the time, the stock soared with these positive preliminary numbers.

So investors priced Q2 results into At Home Group stock back then. Unless the company had reported additional upside surprises, there was no reason for shares to go up on today's results.

A red, upward arrow breaks near the top, resulting in the arrow pointing down.

Image source: Getty Images.

Now what

At Home Group isn't providing guidance for the remainder of 2020. But in the earnings call, management noted that third-quarter-to-date trends were roughly equivalent to Q2 in regard to comps. Furthermore, its loyalty program is strong right now, with membership up 44% year over year. So it's a little bit of a head-scratcher to see the stock fall as hard as it did today.

Investors may be concerned about inventory. At Home Group's net inventories were down 30% in Q2, and management noted it expects some constraints for Q3. It's possible, therefore, the company could fail to supply growing demand.

But to me, it's a reminder of the need to have a long-term horizon when investing in stocks. Day-to-day movements are hard to predict and don't always make complete sense, as is the case with At Home Group stock today.