What happened
Shares of Angi (ANGI 2.45%), which offers an online service that connects home repair and services experts with potential customers, were higher by as much as 15% or so this week, according to data from S&P Global Market Intelligence. As trading got underway on Friday, Dec. 10, they were sitting at the high end of their weekly range, with a roughly 14.5% advance. There was no particular news out of Angi that would have precipitated this move, but there are some other factors here that might have led investors to reevaluate the shares.
So what
The biggest news out of Angi this week came on Dec. 7, when the company released survey results about home improvement trends after having spoken to around 6,400 homeowners. It was interesting reading, noting that home improvement spending rose in 2021 and that the most common improvements were interior painting and bathroom remodels. It's worth taking a look at the report if this type of data interests you, but it really wasn't something that you would expect to move the stock price.
Image source: Getty Images.
What's more interesting here is that the largest gains came on Monday and Tuesday of the week, when the S&P 500 index also rose smartly. That was tied to investor sentiment shifts around the impact of the omicron variant of the coronavirus. While it is still too early to tell what impact this new version of the variant will have, broadly speaking, investors seem to be of the mind that it won't be too bad. Assuming that the current view is correct, it would likely be good news for Angi. Essentially, there's no reason for consumers to stop inviting people into their homes to perform tasks, like painting the walls and renovating a bathroom or two.
Now what
Angi's stock price got a boost in 2020 as it became clear that people stuck at home were spending on upgrading their living experiences. Since more than doubling its 2020 starting price in early 2021, however, the stock has trended slowly lower. It is now only around 18% higher than where it was before the pandemic started to spread. Investor sentiment has been a massive issue over the period with coronavirus news often helping to shift the prevailing mood in positive and negative directions.
The truth is, Angi's business metrics have not been so great of late, with things like ads and leads flat to lower. While revenue has been strong, that's largely attributable to an acquisition. So there's a reason why investors have been less than enthusiastic about the stock. And, thus, there's a reason why you might want to take some time to look past a quick weekly gain, likely driven by investor sentiment, to dig into Angi's actual business results before investing here.
