The markets are flirting with new all-time highs for the second day in a row, driven by a titanic headline increase in the July Durable Goods report. But the economy is hardly a monolith right now. In fact, when you back out the huge rise in airplane orders for Boeing BA – NYSE, you actually get a rather tepid report overall, with an actual -1.5% drop in capital goods orders.
The markets aren’t monolithic either. Yes, there are a host of stocks that are “short-proof” — for now. But there are also companies that are falling short of the mark.
The high-end watch maker Movado MOV – NYSE missed consensus today on both revenues and earnings. Management says we shouldn’t worry though, because they expect a huge rush of sales in the second half of the year that will enable them to meet their previous full-year forecast
Frankly, I've heard that song before, and it almost always ends on a sour note.
MOV fell more than -10% on this news, but that’s just the beginning of its slide. The last two times MOV hit the top quartile of its trend, the follow-on loss averaged -28.05%. If this drop follows suit, it should run as far as $32.50. That’s actually a conservative estimate. Because if that’s a Head & Shoulders in MOV’s chart, then that loss would double!
