Last week was pretty rough on most portfolios. Many stocks still managed to move higher, and some names really took off. Shares of Ambarella (AMBA -1.30%), Blue Apron (APRN), and Build-A-Bear Workshop (BBW -0.79%) rose 12%, 15%, and 17% respectively last week.
Why did these three stocks take off? Let's see why Ambarella, Blue, Apron, and Build-A-Bear Workshop were among the dozens of U.S. exchange-listed stocks to post double-digit gains last week.
Image source: Getty Images.
Ambarella
Ambarella has had its ups and downs over the years. The provider of low-power, high-definition video compression and image processing solutions was a market darling a few years ago. Ambarella was behind the camera chips being used in many action cameras, drones, and home surveillance systems, but some of those markets failed to live up to the hype.
It's staging a comeback on the strength of AIoT, the combination of artificial intelligence and Internet of Things. It's not just the mashing of two tech buzzwords. Ambarella is growing its business in a material way. It posted blowout results last Tuesday, triggering the rally that would find it landing among last week's rare winners.
Revenue soared 64% in its latest report, better than the ambitious 61% growth that analysts were targeting. The beat got even better at the other end of the income statement, as Ambarella's adjusted profit of $0.57 a share trounced the $0.49 a share that analysts were expecting. At least 10 analysts would go on to boost their price targets on the stock.
Guidance for the current quarter also topped where Wall Street pros were parked. Ambarella is well positioned to capitalize on the metaverse trend, as next-gen camera chips are essential for the revolution.
Blue Apron
The one stock on this list that didn't move higher on earnings news was Blue Apron. The distributor of gourmet meal kits didn't offer fresh financials, and its last report -- nearly a month ago -- wasn't very encouraging. Revenue and its quarterly deficit were worse than the market was expecting. The only material news out of Blue Apron was that its recipes can now be pulled up and meal kits can be ordered on any Alexa-enabled device.
The more logical catalyst is that fears of the omicron variant hitting the U.S. finds investors flocking back to some of the initial market winners of the COVID-19 crisis. Blue Apron soared in the springtime of last year when it became obvious that we were going to be preparing a lot more meals at home. No one is suggesting that restaurants will be closing down anytime soon, but you can't blame investors for connecting the dots. If going out to restaurants becomes an unsavory notion again it should benefit Blue Apron and other meal kit specialists.
Build-A-Bear Workshop
You don't want to bet against Build-A-Bear Workshop during earnings season. The retail chain that lets folks create customized plush animals -- seeing them stuffed to life in a festive setting -- is rolling these days. Revenue of $95.1 million in last week's report dramatically exceeded the $84.6 million that analysts were targeting. The chain also surprised the market with a quarterly profit.
The bottom-line beat isn't new. Build-A-Bear Workshop has been crushing profit targets over the past year with ease.
| Quarter | EPS Estimate | EPS Actual | Beat |
|---|---|---|---|
| Q4 2020 | $0.16 | $0.47 | 194% |
| Q1 2021 | ($0.53) | $0.60 | 213% |
| Q2 2021 | ($0.20) | $0.43 | 315% |
| Q3 2021 | ($0.17) | $0.38 | 324% |
Data source: Yahoo! Finance.
Build-A-Bear Workshop has been a big winner in the reopening of the economy, and this isn't just a sales growth story. The specialty retailer has also managed to cope with the higher costs and supply chain disruptions that have tripped up many other companies. In short, Build-A-Bear has been more like Build-A-Bull in this otherwise challenging operating climate.
