Fourth Quarter & 2020 Earnings Previews & Buy RH Stock At New Highs?

On today’s episode of Free Lunch here at Zacks, Associate Stock Strategist Ben Rains discusses the latest U.S.-China trade war updates and looks at some recent positive U.S. economic data. We then dive into third quarter 2019 earnings and see what to expect from Q4 and 2020. The episode closes with a look at why RH (NYSE:RH) is a Zacks Rank #1 (Strong Buy) stock right now.

Stocks climbed higher Wednesday and in early trading Thursday after a rough first two days of December. The positivity came on the back of renewed U.S.-China trade agreement hope after President Trump reversed course from earlier in the week and said talks between the world’s two largest economies are going very well.

China seemed to support Trump’s comments after its Commerce Ministry said that the negotiating teams have remained in close communication.

Meanwhile, U.S. service sector activity expanded in November, according to the Institute for Supply Management. Wall Street now waits on Friday’s U.S. jobs data to help better understand the current economic picture.

Overall, Q3 earnings for the S&P 500 are projected to slip, as they are for fiscal 2019. But looking ahead growth appears to be back on the menu in 2020 (also read: Looking Ahead to the Q4 Earnings Season).

In company-related news, Slack Technologies (NYSE:WORK) stock jumped Thursday as it tries to prove its work-place communication platforms can compete against Microsoft (NASDAQ:MSFT) . Shares of Five Below (NASDAQ:FIVE) also jumped, while Kroger (NYSE:KR) fell.

We then close with why RH, formally known as Restoration Hardware, is a Zacks Rank #1 (Strong Buy) stock. Shares of RH soared over 10% to a new high Thursday, which might make Warren Buffett and Berkshire Hathaway BRK.A happy.

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