The stock market ended Friday higher and notched its best week since November. Despite lingering concerns on a weaker economy, investors bet that inflation would ease in 2023.
Overall, S&P 500 was up 0.4% to 3,999, while NASDAQ increased 0.7% to 11,079.
Tweet of the Day
The stock market generated Breakaway Momentum today for the 25th time since 1945: https://t.co/LhCrAp5qlg
This is a genuine breadth thrust. It means (IMHO) we're in a bull market.
How long it lasts, and how far it carries, is something we will know only in the fullness of time.— Walter Deemer (@WalterDeemer) January 13, 2023
Chart of the Day
Our chart of the day is the one-year chart of Lululemon Athletica (LULU) as of December 28, 2022, when the stock was at $309.
Lululemon is a Canadian designer, distributor, and retailer of high-quality athletic appeal and accessories, marketed under the Lululemon brand.
The company might have to cut prices due to high inventory levels. As such, Lululemon lowered gross profit margin estimates for this quarter, which spooked investors a bit.
The company has a high inventory right now (up 85% year-over-year).
That’s a good thing as it shows the supply chain issues are resolved.
In mid-2021, management was paying expensive air freight to get merchandise in.
This stock has been a 25%-plus grower in the past. We don’t know what the future holds, but the stock seems undervalued with a P/E of 27.
– David Sharek, Founder of The School of Hard Stocks
LULU was added the stock to the Aggressive Growth Portfolio on Friday.
