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Omar Venerio
Omar Venerio
Articles (1708) 

Three Stocks to Watch Wednesday

JinkoSolar, Stitch Fix and KB Home move on financial results

September 23, 2020 | About:

JinkoSolar

Shares of JinkoSolar Holding Co., Ltd. (NYSE:JKS) gained more than 16% Wednesday morning after reporting its second quarter revenue of $1.2 billion, up 18.8% year-over-year, which beat estimates by $70 million.

Chairman and CEO Kangping Chen had the following to say:

"JinkoSolar delivered a strong quarter with total revenue exceeding guidance. Despite the tough economic environment around the world, total solar module shipments and gross margin for the quarter were all within our guidance range. Module shipments hit a new high of 4,469 MW, an increase of 31.0% sequentially and 32.0% year-over-year. Total revenues during the quarter were US$1.20 billion, an increase of 16.0% (excluding the impact from disposal of the solar power plants in the first quarter of 2020) sequentially and 22.2% year-over-year, while gross profit was US$214.1 million. We expect orders for the third and fourth quarters to increase, with total solar module shipments expected to be in the range between 5 GW to 5.3 GW for the third quarter, and our guidance for total shipments for the full year 2020 remains unchanged at 18GW to 20 GW."

In the quarter, the gross profit was 1.51 billion Chinese yuan ($220 million) compared with ¥1.66 billion in the first quarter of 2020 and ¥1.14 billion in the second quarter of the previous year. This increase was due to an increase in the shipment of solar modules.

The gross margin reached 17.9%, down from 19.5% in the first quarter of 2020 and 16.5% in the second quarter of 2019.

The income from operations was ¥434.7 million, down from ¥732.7 million in the first quarter of 2020 but higher than ¥260.3 million in the second quarter of 2019.

Stitch Fix

Shares of Stitch Fix, Inc. (NASDAQ:SFIX) fell more than 16% after the company posted its fiscal fourth-quarter results. Revenue grew 2.6% from the prior-year quarter to $443.41 million, beating estimates by $27.89 million. The company posted a loss of 44 cents per share, falling short of analyst's estimations by 27 cents.

Founder and CEO Katrina Lake said:

"I'm proud of our team for successfully navigating through the deepest impacts of COVID-19 and am excited to bring our model of an individual and deeply personalized shopping experience to even more consumers as they transition to a future of online shopping."

The company grew active clients to 3.5 million, an increase of 9% year over year, and generated $443 million in net revenue, reflecting 11% adjusted year-over-year growth.

During the quarter ended March 31, Joel Greenblatt (Trades, Portfolio) sold out the stock.

KB Home

Shares of KB Home (NYSE:KBH) fell more than 6% after announcing its fiscal third-quarter results. The company posted earnings per share of 83 cents on $995.15 million in revenues, a 14.2% year-over-year decline. The company beat analyst EPS predictions by 33 cents and revenue predictions by $109.61 million.

Homebuilding operating income rose to $88.9 million from $85.5 million. Further, the homebuilding operating income margin inched up 150 basis points to 8.9%.

The housing gross profit margin was up 140 basis points to 19.9% and the adjusted housing gross profit margin increased to 23.7% from 22.3%.

During the quarter ended June 30, Donald Smith (Trades, Portfolio) reduced his holding in the stock by 45.5% to 175,410 shares. Ken Fisher (Trades, Portfolio) boosted his position by 11% to 2,765,114 shares and Joel Greenblatt (Trades, Portfolio) initiated a new position with 10,869 shares.

Disclosure: The author holds no position in any stocks mentioned

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About the author:

Omar Venerio
Omar Venerio is a capital markets, derivatives, corporate finance and financial management professor and Area Head of Finance. He is passionate about the stock market and providing independent fundamental research and hedge fund and insider trading-focused investigation.

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