Hot Stocks: AI, M, OKTA, and DG fall on earnings; META and BABA rise
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Major market indexes rose during Thursday's noon session as the United States House passed a debt-ceiling deal to prevent a default.
Tracking individual stocks, C3.ai (NYSE:AI), Macy's (NYSE:M), Okta (NASDAQ:OKTA) and Dollar General (NYSE:DG) shares plunged on disappointing earnings results and outlook under macroeconomic pressure.
Meanwhile, Chewy (NYSE:CHWY) jumped following upbeat Q1 earnings and a revenue guidance boost.
In other tech-related news, Meta Platforms (NASDAQ:META) rose after introducing the Quest 3 VR headset, while Alibaba Group (NYSE:BABA) rose after launching its ChatGPT-style technology.
Gainers
Chewy (CHWY) shares surged more than 24% after the pet supplies e-commerce business outperformed expectations in Q1. In addition, the company boosted its fiscal 2023 guidance and announced intentions to expand to Canada in Q3. Revenue for 2023 is expected to be in the range of $11.15B to $11.35B, up from a previous forecast of $11.0B to $11.3B.
Meta Platforms (META) shares rose more than 2% after the company launched the Quest 3 VR headset, which starts at $499.99 and is the successor to the Quest 2 VR headset, which was released in the fall of 2020 at a starting price of $299. The tech titan announced the Quest 3 headset before Apple (AAPL) is scheduled to unveil its own AR/VR headset at its WWDC developer conference on June 5.
Alibaba Group (BABA) stock rose as much as 5% after the company announced plans to incorporate its ChatGPT-like AI service into messaging app DingTalk and a meeting assistant called Tingwu. The company said it will release additional features for the new version of the assistant, called Tongyi Tingwu, later this year.
Decliners
Despite exceeding the consensus mark in Q4, C3.ai (AI) stock tumbled more than 14% on a disappointing Q1 outlook. The company sees Q1 revenue in the range of $70M-$72.5M vs. $71.45M consensus and fiscal 2024 revenue in the range of $295M-$320M vs. $315.37M consensus.
Macy's (M) stock dipped as much as 1% on weak Q1 earnings and a guidance cut blaming macroeconomic factors. The company now expects fiscal 2023 sales to fall in the range of $22.8B to $23.2B (mid-point of $23.0B) vs. the prior range of $23.7B to $24.2B (mid-point of $23.95B) and the consensus estimate of $24.01B. EPS of $2.70 to $3.20 is anticipated vs. the prior range of $3.67 to $4.11 and the consensus mark of $3.71.
Okta (OKTA) shares slipped 19% after J.P. Morgan downgraded the stock to Neutral from Overweight and BMO Capital Markets cut its rating to Market Perform following the company's better-than-expected Q1 results. With growth projected to slow in the near term and cash flow not yet at levels to justify valuation, J.P. Morgan believes there are better risk-reward opportunities elsewhere in its portfolio.
Dollar General (DG) shares dropped 19% on missing Q1 expectations and slashing sales guidance. The company sees fiscal 2023 comparable sales growth of +1% to +2% vs. a prior view of +3% to +3.5% and +3.3% consensus, and diluted EPS in the range of an approximate 8% decline to flat, compared to its previous expectation of growth of approximately 4% to 6%.
To keep track of Wall Street's biggest winners and losers throughout the session, head over to Seeking Alpha's On The Move section.
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