Ulta Beauty (ULTA) shares received the “Buffet Bump” treatment today as the stock surged more than 11% for day following the report that Berkshire Hathaway had initiated a new position in the stock.
The news dropped last night as Berkshire’s quarterly 13-F filing was made public. The filing showed that Berkshire purchased 690,000 shares of Ulta over the last reporting period.
Shares currently trade more than 35% below their all-time highs posted in February 2024 and are threatening to break below a key price support level.
The company has suffered through a contraction in revenue growth that started in August 2021. That contraction led to a bear market trend for Ulta Beauty shares that ended in December 2023. Shares broke back into a new long-term bearish trend shortly afterward in April 2024, which they remain in today.
Buffett’s purchase of the shares comes as the stock challenges the $350 price level.
The long-term monthly chart of Ulta Beauty shows this to be an extremely important level for the stock as shares have seen both strong support AND resistance at $350.
Buffet or no Buffet, shares of Ulta Beauty will suffer another round of heavy selling if shares break below $350.
Self-described “Inflation Fighter” Walmart (WMT) posted a strong quarterly performance according to the company’s earnings report this morning.
Walmart’s earnings came in $0.02 better than analysts’ expectations with revenue showing a 4.7% increase from the same quarter last year. The company’s revenue is the lowest growth since May of 2022, but Walmart management assured investors that they have not seen a significant drop of consumer activity.
The company pointed to success in the launch of their private label food brand, “bettergoods” as well as the early relaunch of the young adult “No Boundaries” clothing brand. Both private branding projects are a move to match Kroger’s success with the Private Selection” that has grown tremendously.
Walmart stock is trading 6.5% higher near Thursday’s close. The response to Walmart’s earnings helped to drive the Consumer Discretionary sector to a 4% gain for the day, second only to the semiconductor sector performance of 5.4%.
Walmart shares crested to new all-time highs today on the earnings news with all of the stocks with all of the stock’s key trendlines in a bullish pattern.
Shares of WMT remain bullish with a price target of $90.
Shares of Super Micro Computer (SMCI) rallied almost 10% as technology and AI stocks led the market higher on Thursday.
Super Micro Computer shares recently traded to $500 after positing highs at $1,200 in March. The rapid 60 decline in the stock is the result of general selling of the AI industry stocks as well as a poor earnings results last week.
On August 8, Super Micro Computer announced earnings per share that were $1.87 lower than expectations of $8.12. Revenue for the quarter matched the market’s expectations.
The company’s earnings reflected tighter margins, the result of investing capital to scale their AI business.
Shares of the stock hit $500 within days of the earnings miss where they found short-term support. The stock also registered an oversold reading from its RSI. This technical indicator gauges when a stock of index has been sold too quickly over a period.
The oversold reading and psychological round-numbered value of $500 proved to be a short-term buying opportunity as Super Micro Computer are now trading more than 20% higher from that bottom.
Looking forward, investors should be weary of the stock’s 50-day moving average. That widely watched trendline is in a bearish trend.
Another technical trendline that investors should be watching is the 200-day moving average. This trendline is above current prices at $670. A move back above that key trendline will fuel more bullish buying of Super Micro Computer stock.
