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Omar Venerio
Omar Venerio
Articles (1417) 

Wall Street Sinks on Tuesday

RH's stock rallies in premarket trading

U.S. stocks were in negative territory on Tuesday, with the Dow Jones falling almost 400 points. The Dow Jones Industrial Average fell 1.53% to 25,414, the S&P 500 index fell 1.66% to 2,744, and the Nasdaq Composite Index retreated 1.82% to 7,306.

Shares of RH (NYSE:RH) gained almost 12% on Tuesday, after the company posted third-quarter earnings of $1.73 per share, on revenue of $636.56 million, reflecting 7.4% year-over-year growth. The company beat earnings estimates by 46 cents and on revenue expectations by $4.57 million.

The comparable brand and net revenues declined 1 point due to slower special order receipts from China. However, the company generated $6 million of free cash flow in the trimester, and projects free cash flow in excess of $260 million for the entire year.

Looking ahead, the company raised fourth quarter revenue guidance to a range of $680 million to $690 million, from prior guidance of $665 million to $685 million. It also raised diluted earnings per share guidance between $2.75 and $2.90, versus a previous guidance range of $2.33 to $2.54. For the full year fiscal 2018, revenue guidance was elevated to a range of $2.519 billion to $2.529 billion, versus previous guidance of $2.489 billion to $2.521 billion.

Gainers

• Autozone Inc. (NYSE:AZO)

• SCANA Corp. (NYSE:SCG)

• Verizon Communications Inc. (NYSE:VZ)

• NiSource Inc. (NYSE:NI)

• Edison International (NYSE:EIX)

Losers

• United Rentals Inc. (NYSE:URI)

• Advanced Micro Devices Inc. (NASDAQ:AMD)

• Applied Materials Inc. (NASDAQ:AMAT)

• Fluor Corp. (NYSE:FLR)

Global markets

The main European stock markets traded lower. The U.K.'s FTSE 100 fell 0.56%, France's CAC 40 slid 0.82%, Germany's Dax dipped 1.14% and Spain's Ibex 35 retreated 1.28%.

In Asia, Japan's Nikkei 225 lost 2.39%, India’s BSE Sensex fell 0.29%, Hong Kong's Hang Seng gained 0.29% and China's Shanghai Composite rose 0.42%.

Disclosure: The author holds no positions in any stocks mentioned.

About the author:

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

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