What Happened?
Shares of luxury watch company Movado (NYSE: MOV) jumped 3.2% in the afternoon session after a broad market rally as the United States and Japan reached a new trade agreement. The deal, which set a 15% tariff on Japanese goods imported into the U.S., was viewed favorably by investors and spurred optimism across the market. This positive sentiment contributed to gains across multiple sectors as the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite all climbed. While there was no company-specific news driving Movado's stock, the watchmaker likely benefited from the overall risk-on mood that lifted many consumer-focused companies. The improved trade outlook appeared to ease investor concerns about potential economic headwinds.
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What Is The Market Telling Us
Movado’s shares are not very volatile and have only had 6 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 11 months ago when the stock dropped 13.3% on the news that the company reported weak second quarter earnings. Full-year revenue guidance was lowered and missed. In addition, EPS missed, but Movado exceeded analysts' revenue expectations. The company cited a "challenging consumer spending environment compounded by increased expenses to support future growth." Overall, this was a weaker quarter, but expectations were also seemingly low going into the print.
Movado is down 12.6% since the beginning of the year, and at $17.08 per share, it is trading 34.1% below its 52-week high of $25.92 from July 2024. Investors who bought $1,000 worth of Movado’s shares 5 years ago would now be looking at an investment worth $1,599.
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