Shares of The Container Store Group (NYSE:TCS) were crushed on Monday, closing the session down 16%. If anything, this is the opposite of what you'd expect. CNBC personality Jim Cramer just expressed his appreciation for the stock, and he even had CEO Melissa Reiff on his show late last week.
The stock is still down about 75% from highs reached all the way back in 2014. Business wasn't good for a while, leading to the big losses. But Reiff says her company has fundamentally reimagined its business of late, and Cramer brought her on Mad Money so investors would give this forgotten stock a second look.
Shares of The Container Store, even after today's drop, are still up more than 100% in 2020. Furthermore, the stock had been about a 10-bagger since March lows. The profits from this incredible run-up were likely too much for swing traders to resist, with some unexpectedly cashing out today. That's why it's important to remember that stock movements are harder to predict the shorter your outlook is.
The Container Store's business has held up fairly well for a consumer-discretionary company this year. Through the first two quarters of the year, net sales are only down 10%. But the company's outlook is improving given its 17% sales growth in September, its most recently reported month. Furthermore, the company has been profitable this year with $3.5 million in net income. Therefore, it seems that at least some of the gains for stock have been warranted.