3 Stocks To Watch In The Coming Week: AMC, GameStop, Chewy
Investing.com | Jun 06, 2021 18:25
Equities wrapped another strong week as investors remained focused on the U.S. economic reopening, and sectors that are going to benefit from it.
Energy was the best-performing major sector, gaining more than 6.7% as oil prices jumped nearly 5% in the past week. REITs were the second-best performer, up 3.1%, followed by financials, up 1.2%. The S&P 500 rose 0.6% to 4,229, just 9 points shy of its record high. The Dow gained 0.7%, while the NASDAQ was up 0.5%.
Besides these reopening trades, meme stocks were again on fire grabbing headlines and contributing to concerns that the rampant speculative activity could derail the post-pandemic bull market. Keeping that in mind, below, we have put together a list of three stocks which could dominate the market action this week.
1. AMC Entertainment Holdings/h2
The shares of AMC Entertainment Holdings (NYSE:NYSE:AMC), the most popular meme stock these days, could see roller-coaster trading activity as some investors race to cash in on their hefty gains.
Among those are the company’s executives and directors who sold $8 million in shares of the money-losing theater chain in the past week, according to regulatory filings. Two board members and four executives sold at near record prices, after the stock surged more than 80% in the past week.
The stock closed on Friday at $47.91, down about 8%. That follows a day in which AMC’s eye-popping rally was interrupted by the company’s plans to sell more equity.
The stock’s surge has enabled the movie-theater chain to sell equity to shore up its balance sheet that left AMC close to bankruptcy only a few months ago when the pandemic forced closure of its theaters and competition from streaming services surged.
2. GameStop /h2
Another meme stock which could steal investors’ attention this week is GameStop Corp (NYSE:GME) which is scheduled to report its quarterly earnings on Wednesday, June 9, after the market close. Analysts, on average, expect the video-game retailer to report $0.67 a share loss on sales of $1.13 billion.
GameStop shares have soared more than 1200% this year on frenetic buying by individual investors. The stock closed on Friday at $248.36 after falling more than 3%. Like many other meme names, GME stock is also detached from fundamentals.
The past quarter was the company’s 12th straight quarter of declining sales amid a challenging environment for the brick-and-mortar game retailer. In March, GameStop brought in several new executives to accelerate its shift to digital. It also appointed two other executives with tech experience as part of a push by activist investor and board member Ryan Cohen to make the brick-and-mortar chain a digital powerhouse.
3. Chewy /h2
The online pet-products retailer, Chewy Inc. (NYSE: NYSE:CHWY), will report its latest quarterly earnings on Thursday, June 10, before the market open. Analysts are predicting three cents a share loss on sales of $2.12 billion.
After the pandemic-driven boost to e-commerce sales, when people stocked up on food and toys for pets, Chewy expects this trend to continue. The retailer reported in March that its customer base grew by 43% to 19.2 million active users, helped by the coronavirus blight which drove millions of new customers to adopt pets and use its online services.
Chewy expects net sales between $8.85 billion and $8.95 billion in 2021, implying about 25% growth compared to last year as the company remains in its early phase of growth. Chewy shares closed on Friday at $75.21, after falling 16% this year. During the past one year, they have gained more than 50%.
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