In the ever-dynamic arena of stock trading, Tapestry has emerged as a remarkable contender with its shares soaring an impressive 120% over just six months. Such a rapid ascent, particularly for Tapestry—parent company of well-known brands like Kate Spade and Coach—has attracted considerable attention from investors and market analysts alike. Recently, Sylvia Jablonski, co-founder and CEO of Defiance ETFs, weighed in on the company’s performance during her appearance on CNBC’s “Power Lunch.” Despite the stock’s remarkable rise, she emphasized a prudent approach, suggesting that now might be an opportune moment for investors to realize their gains.
Tapestry’s stock hit an all-time high after announcing strong fiscal second-quarter adjusted earnings that exceeded estimates, coupled with a raised outlook for the full year. On the surface, this sounds promising; however, Jablonski offered a more nuanced perspective. She pointed out that over the past five years, Tapestry has posted a compounded annual growth rate of merely 2.6%, with a mere 1.6% growth when adjusted for constant currency. This raises concerns about the sustainability of its recent gains, indicating that the company might be resorting to significant markdowns to spur growth, rather than achieving organic increases in demand. Her mixed sentiments suggest that while Tapestry has performed well recently, potential investors should tread carefully.
Roblox: A Cautionary Tale of Falling User Engagement
Roblox, a favorite among gaming enthusiasts and investors alike, has recently faced challenges that have seen its shares plummet by 11%. This downturn followed the release of disappointing fourth-quarter results that fell short of expectations on multiple metrics. Jablonski remains cautious about the company, advising against buying during this dip due to weak forward guidance and a notable decline in daily user engagement, which is a critical indicator in the gaming sector.
The reported figures from Roblox—$1.36 billion in bookings against an anticipated $1.37 billion, accompanied by 85.3 million daily active users compared to the expected 88.2 million—paint a troubling picture. Jablonski highlighted that for investors in gaming platforms, the focus is squarely on daily engagement statistics, a realm where Roblox appears to be slumping. In a sector where user activity is paramount, this downward trend casts a cloud over the company’s growth trajectory, signaling to investors the need for caution.
Oracle: Riding the AI Wave
In a stark contrast to the uncertainties surrounding Tapestry and Roblox, Oracle presents a compelling case for investment. Jablonski’s bullish stance on Oracle underscores its pivotal role in the burgeoning field of artificial intelligence (AI) infrastructure. She characterized Oracle as “the cool kid on the block,” signaling a renewed interest and innovation from the tech giant.
Oracle’s stock has experienced a 50% increase over the past year, a testament to its forward-thinking strategies and robust positioning within the tech sector. Jablonski expressed confidence in the company’s ability to harness AI advancements, likening its innovative capabilities to essential tools like DeepSeek, which contribute to making AI applications more effective. The integration of cloud solutions with AI infrastructure not only bolsters growth but positions Oracle advantageously for future market demands.
While investors should celebrate the success of companies like Tapestry and Oracle, the stark contrast in their current trajectories illuminates the complex nature of market investing. Emphasizing growth potential and user engagement will be vital for navigating the future of these significantly different firms.