Why AMD, Coach, and PetMed Express Tumbled Today

Even though the broad stock market posted another day of modest gains, some stocks gave up substantial ground today. Find out why Advanced Micro Devices plunged 12%, while Coach and PetMed Express both dropped about 6% today.

Jan 22, 2014 at 8:30PM

Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

Stocks posted minimal gains today, with the S&P 500 rising a single point even as the Dow declined on earnings-related news. For many stocks, though, the news wasn't as good, as Advanced Micro Devices (NASDAQ:AMD), Coach (NYSE:COH), and PetMed Express (NASDAQ:PETS) all fell substantially today.

AMD dropped 12% after its earnings report included discouraging guidance for its current quarter. Huge sales of video game consoles with AMD chips helped power fourth-quarter revenue up 38% from the previous-year's quarter, but the sales only produced adjusted net income of $45 million. But the company said that it expects first-quarter 2014 sales to drop 16%, and gross margins will likely stay at lower levels for the foreseeable future.

Coach declined 6% after missing earnings and revenue estimates for its holiday quarter. The luxury retailer suffered particularly bad results in North America, where same-store sales fell 13.6%. Even relatively strong 11% growth in international sales excluding currency impacts wasn't enough to offset poor performance closer to home, as Coach continued to struggle against the strength of rival Michael Kors (NYSE:KORS) and its more successful work at making itself a lifestyle brand. Coach needs to find an answer to its lack of popularity if it wants to return to investors' good graces.

PetMed Express also fell 6% after reporting sluggish sales and unimpressive net income. Earnings per share were flat compared to the year-ago period, but the pet-products seller only managed to grow revenue by 1% despite solid increases in reorder and e-commerce sales figures. Despite efforts to cut operating expenses in order to bolster profitability, PetMed Express hasn't been able to deliver the increased traffic that investors have wanted to see. Moreover, as Amazon (NASDAQ:AMZN) starts to notice the profit potential from pet-related sales, PetMed Express could see more competition at the worst possible time for the company.

What's next for retailers?
Coach and PetMed Express disappointed investors today, but to learn about two retailers with especially good prospects, take a look at The Motley Fool's special free report on The Real Cash Kings Changing the Face of Retail. In it, you'll see how these two cash kings are able to consistently outperform and how they're planning to ride the waves of retail's changing tide. You can access it by clicking here.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter: @DanCaplinger. The Motley Fool recommends Amazon.com, Coach, and Michael Kors Holdings and owns shares of Amazon.com and Coach. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.


Compare Brokers