Please ensure Javascript is enabled for purposes of website accessibility

Why Angi Stock Jumped 19% This Week

By Jeremy Bowman – Sep 16, 2021 at 3:38PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Strong numbers in August propelled the stock higher.

What happened

Shares of Angi (ANGI 3.65%) were climbing this week after the home-services marketplace posted impressive numbers in its key metrics report for August.

The stock was up 19% for the week on that news as of Thursday afternoon.

A plumber tightens a nut under a sink.

Image source: Getty Images.

So what

The major catalyst for the week's gains was an update showing Angi's monthly revenue grew at its fastest pace since August, a promising sign that momentum is building as its 21% growth in August comes on top of 12% growth in August 2020.

Angi's marketplace, its biggest business segment, posted top-line growth of 24%, and revenue from Angi Services -- the fast-growing, pre-paid product that automatically books jobs for homeowners -- saw its sales jump 165% following 170% growth in July, indicating a strong performance for the third quarter as a whole.

Though management did not provide any commentary on the performance, the results seem to indicate that its turnaround efforts are beginning to pay off. In March, the company launched a rebrand, changing the corporate name and the brand name Angie's List to Angi, while HomeAdvisor became "HomeAdvisor, powered by Angi."

That decision came shortly after Oisin Hanrahan was named as Angi's new CEO. Hanrahan is the founder of Handy, the fixed-price home-services platform that was acquired by Angi in 2018. Hanrahan is betting that new products like Angi Services and Angi Key, a $30 annual membership program that offers customers 20% discounts on pre-priced jobs, among other benefits, can help drive its turnaround.

Now what

The August metrics came out on Sept. 13, and the stock jumped 9% the following session, but Angi also gained again on Sept. 16, climbing 8% on no news. That could signal that the stock is ripe for a larger breakout especially if the company is gaining traction in its turnaround.

Investors won't get a complete earnings report until November, and September metrics will be available next month. But the stock could have more room to run as it has historically been volatile, and 13% of the stock is sold short, indicating potential for a short squeeze .

Jeremy Bowman owns shares of ANGI Homeservices Inc. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.