Dillard’s Stock (DDS) Surges On Earnings… Into Resistance

Dillard’s (NYSE: DDS) soared 22% on Tuesday morning, after the company posted earnings that beat Wall Street expectations. 

However, the stock is now in a resistance zone and we expect it to fail in the coming months.

The company reported earnings per share of $3.22 and total revenue of $2.06 billion, compared to analyst estimates of $2.66 and $2.03 billion. Same store sales increased by 2%, above the consensus of 0.5%. 

CEO William Dillard explained that, “Our 2 percent comparable store sales increase for 2018 is comprised of four quarters of positive sales. We also held retail gross margin and operating expenses flat as a percent of sales.”

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Nonetheless, we remain cautious, as this rally has taken DDS into a big resistance zone. While our review of the stock’s market cycles shows it is still in a rising phase, the close of this cycle is drawing near.

We expect the rally to fail soon, falling back to near $70 by June. 

Dillard’s (DDS) Stock Weekly Chart 

dillards dds stock research forecast investing february march year 2019

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Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.