Stocks were flat in early trading this morning as Wall Street gears up for a massive week for earnings. A slew of megacaps will be reporting this week as investors look for clues on how companies are faring in the recovery. Tesla (TSLA) kicks off earnings after the bell today, with Google parent Alphabet (GOOGL), Microsoft (MSFT), Apple (AAPL), Facebook (FB) and Amazon (AMZN) also due in the coming days. These earnings reports alone will have a big impact on the stock market rally. All told, these six stocks have a market cap of just over $9 trillion.
U.S. Treasury yields rose amid confidence the Federal Reserve will remain accommodative even as robust growth takes the world’s largest economy back to pre-pandemic levels.
It seems the biggest concern the markets have at this point is that everyone agrees that we’re at the beginning of a big post-pandemic economic expansion. And if that’s the case, then one of the best ways to get involved in a growing market is with small-cap stocks.
They’re the best performing tier of stocks when economic growth is rising, since they have more ability to grow and grow quickly. Our trade alert for today highlights one great small firm to consider with economic expansion on the horizon.
Best known for its “The Container Store” brand, The Container Store Group Inc (TCS) also markets Swedish Elfa brand shelving solutions to a number of different home goods and home improvement stores around North America.
TCS was certainly a winner during the pandemic as lockdowns and social distancing meant people had the time and means to upgrade their homes, including decluttering, reorganizing and upgrading.
The company’s net sales were $275.48 million for the fiscal 2020 third quarter, ended December 26, 2020, which represents an improvement of 20.5% year-over-year. TCS’ gross profit increased 18.7% year-over-year to $159.49 million. While its income from operations came in at $32.84 million for the quarter, up 248.2% year-over-year, its net income was $19.67 million, up 715.5% year-over-year . Also, its adjusted EPS increased 740% year-over-year to $0.42.
And now that the economy is opening up, there’s even more opportunity for TCS as home sales peak season gets underway and people will begin entertaining again. The company seems to be ready for this fresh demand.
In February TCS appointed Satish Malhotra as the new CEO and company President and his expansion plans are already taking effect. The company has already opened one new location this year and there are plans for more this summer, according to a report published on March 5th. TCS’ consensus revenue estimate of $222.60 million for the next quarter, ending June 30, represents a 45.8% rise from the prior year period. The stock is up 54% year to date yet has a current P/E over 21x. And with a market cap of $759 million, it’s in the sweet spot for small-cap stocks.
Where to invest $1,000 right now...
Before you consider buying The Container Store, you'll want to see this.
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And it's not The Container Store.
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Keith say’s he thinks investors will be able to turn a small $50 stake into $150,000.
Find that to be extraordinary?
Click here to watch his presentation, and decide for yourself...
But you have to act now, because a catalyst coming in a few weeks is set to take this company mainstream... And by then, it could be too late.
Click here to find out the name and ticker of Keith's #1 pick...
