What Happened?
Shares of optical retailer National Vision (NYSE: EYE) jumped 12.5% in the afternoon session after the company reported strong first quarter 2025 results which included optimistic full-year EPS guidance that blew past analysts' expectations and EBITDA that outperformed Wall Street's estimates. Sales were up and about 6% higher than last year, with stores seeing more traffic and people spending more per visit. Zooming out, we think this quarter featured some important positives.
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What The Market Is Telling Us
National Vision’s shares are quite volatile and have had 18 moves greater than 5% over the last year. But moves this big are rare even for National Vision and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 16 days ago when the stock dropped 6.1% on the news that President Trump criticized the Federal Reserve's approach to interest rate cuts, warning that the pace was slow and could hinder economic growth. Trump's comments added pressure to an already sensitive market, raising concerns about political interference in monetary policy.
Meanwhile, Fed Chair Jerome Powell maintained a cautious stance the previous week, highlighting the difficulty of balancing the dual mandate of steady employment and price stability amid the escalating trade tension. Investor sentiment was further dampened by the absence of constructive progress in trade negotiations, especially US-China relations which took a turn for the worse in the previous week.
Overall, the outlook seemed more unclear heading into the first quarter 2025 earnings season, as a combination of hard to predict monetary policy and unresolved trade tensions weighed on business confidence.
National Vision is up 37.4% since the beginning of the year, but at $14.80 per share, it is still trading 17.2% below its 52-week high of $17.87 from May 2024. Investors who bought $1,000 worth of National Vision’s shares 5 years ago would now be looking at an investment worth $605.11.
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