The Market Finished with Mixed Results
The Nasdaq index finished the day in the red. In contrast, the other two indexes ended the day in the green zone but only barely. Despite the slight upward movement by the Dow index, it hit a new record high thanks to a few solid quarterly earnings reports by the likes of General Motors (GM).
The economic indicator that grabbed my attention is ADP's private payrolls report that grew by 742,000 in April. While the growth was quite solid, it still missed the expectations. At this point, no one doubts that the U.S. economy is on its way to recovery.
Why Did Shares of Match Group (MTCH) Jump More Than 3% Today?
Shares of Match Group (MTCH) jumped more than 3% today. If you don't know Match Group, you should. It has more than 45 online dating brands. It has solid operations with growing revenue, profitability, and free cash flow. It announced its quarterly earnings reports, and investors are pretty satisfied with the company's performance. Revenue, operating income, adjusted EBITDA, # of subscribers, and revenue per subscriber were all up. That's what you'd want to see from the companies you invest in.
Moreover, based on Analysts' price target, the stock price still has room to grow up to an average target of $162.74. You can see the average price target on the company's Stock Card under the Fair share price section.
By the way, remember we discussed Alteryx's (AYX) 6% price jump yesterday? Shares continued to move up after yesterday's better-than-expected results.
Why Has Peloton's Stock Price Dropped More Than 14%?
Shares of Peloton (PTON) dropped more than 14%. The stock price is down 45% since the start of the year. But, today's price drop comes after a voluntary recall of the company's Treadmill product. A few weeks ago, there was the sad news of the death of a child after getting injured by Peloton's treadmill.
While it might be tempting to jump on the wagon of buying the dip, however, remember, this is a product-related issue that could impact the company's future growth potential. It's not too different from when a restaurant such as Chipotle announced an Ecoli outbreak in 2015-2016. While Chipotle (CMG) managed to recover from the dip quite nicely, but it took a few years for the company to do so.
Product-related issues tend to damage a company's brand and reputation. It takes a lot of marketing dollars and time to recover from it after the initial technical or product problem is resolved. Perhaps, hold before buying the dip in Peloton's stock.
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