Business strength delivered Friday gains for these 2 stocks

Investors have been waiting for an all-clear on the inflation front, and as premature as it may seem to put too much emphasis on single-month CPI readings, markets continued to gain momentum on Friday after Thursday’s surge. That Nasdaq Composite (^IXIC 1.88%) climbed almost 2% during the Dow Jones industry average (^DJI 0.10%) and S&P500 (^GSPC 0.92%) had more modest gains.


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Data Source: Yahoo! finance.

Corporate fundamentals remain important, and as such, investors are keeping a sharp eye out for signs of strength in the quarterly earnings reports that are released each day. Solid news on Friday Matterhafen (MTTR 24.42%) and figs (FIG 5.17%) boosted confidence that the economy could still emerge from a recession. Below, you’ll learn more about what Matterport and Figs said and why their shareholders responded positively to their news.

A big win for Matterport

Matterport shares rose 24% on Friday. Investors reacted positively to the digital transformation specialist’s latest quarterly results.

Matterport saw revenue jump to a record $38 million, up 37% year over year and beating the company’s previous guidance. Subscription-based revenue grew 21% year over year, while services revenue tripled. The company’s business metric for space under management rose 40% to 8.7 million. Adjusted loss of $0.09 per share beat Matterport’s expectations for the quarter.

Matterport tracks a combination of subscription-based recurring revenue and product sales, and appears to be on track so far. The launch of the Enterprise Essentials subscription suite has seen some success and Matterport’s new Pro3 camera product shipped during the quarter. Investors are excited that the company is developing new use cases, including bringing its immersive digital technology to real estate marketing through its acquisition of VHT Studios.

Best of all, Matterport raised its guidance going forward, expecting full-year 2022 revenue of $134 million to $136 million and adjusted losses of $0.41 to $0.43 per share. Even after today’s gains, the stock remains 75% down from where it started the year, but shareholders seem hopeful that better times are ahead.

Figs keep you healthy

Shares in Feigen rose more than 5% on Friday. The maker of gowns and other custom-made apparel for the medical community reported third-quarter results that reassured shareholders about the company’s future prospects.

Figs said sales were up 25% year over year to $128.6 million, citing increasing order numbers from both existing and new customers for the healthcare apparel and lifestyle brand. Rising freight and overhead costs weighed on margin development and significantly increased overall costs, but Figs still managed to post a modest profit of $4 million, equivalent to earnings of $0.02 per share.

Figs saw solid fundamental performance from its business. Active customers grew nearly 24% from 12 months ago to 2.2 million. Revenue per customer rose 4% to $227, but average order value increased nearly 10% to $112. Figs said it sold higher-priced items than in the prior-year period and that customers tended to buy more items per order than before.

Shareholders were also pleased that the Figs project reported full-year 2022 sales of $495 million, an increase of 18% from 2021 levels. That’s a slowdown from what the company has seen earlier in its history, but as consumers move away from discretionary spending, it’s good to see Figs’ products retaining customer loyalty.

Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool has a position in and recommends Matterport, Inc. The Motley Fool has a disclosure policy.


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