Why 3D Systems, Bed Bath & Beyond, and PriceSmart Tumbled Today

The stock market fell sharply as investors increasingly fear a larger correction, but these stocks performed even worse than the broader market. Find out why here.

Apr 10, 2014 at 8:25PM

After beginning the day on a relatively calm note, the stock market ended the day with a huge plunge, with the Nasdaq suffering its worst decline in almost two-and-a-half years. Losses were widespread, with few stocks managing to avoid the downdraft. But some of the more dramatic decliners on Thursday were 3D Systems (NYSE:DDD), Bed Bath & Beyond (NASDAQ:BBBY), and PriceSmart (NASDAQ:PSMT), all of which fell more than 5% today.


Source: The Sugar Lab, acquired by 3D Systems.

3D Systems dropped 11%, bringing its losses during the past three months to almost 50%. In addition to the general disdain among the investor community for the market's top performers recently, Fool contributor Steve Heller noted earlier today that competition from up-and-coming new 3-D printing companies could eventually challenge 3D Systems despite its first-mover status. Indeed, the competitive framework for 3D Systems is increasingly complex, with new start-ups threatening 3D Systems from below, while established industrial giants consider plans to enter the high-end industrial 3-D printing market. Although it's too early to tell whether any of 3D Systems' new rivals will be able to mount a credible challenge to the company over the long run, 3D Systems shareholders should be aware of the potential for negative catalysts in the future from upstart companies in the industry.

Bed Bath & Beyond fell 6% after the company released disappointing results and guidance. The home-furnishings retailer saw overall revenue drop 6%, resulting in an 11% decline in earnings from the year-ago holiday quarter. Even though same-store sales rose 1.6%, Bed Bath & Beyond said that it expected revenue growth of just 2% to 3.5%, and earnings guidance for the current quarter and full fiscal year also fell short of what shareholders had wanted to see. With Bed Bath & Beyond fighting rivals on the e-commerce front, as well as dealing with saturated markets, it's uncertain when it will be able to start growing more strongly again.

PriceSmart tumbled almost 12% despite reporting better earnings in its fiscal second quarter than investors had expected. Total revenue jumped 11%, and earnings rose by almost 14% from the year-ago quarter. But PriceSmart saw gains of just 1.9% in same-store sales during March, and that led to worries about whether the warehouse club retailer can sustain its growth at a sufficient pace to justify its stock price. In order for PriceSmart to match the long-term growth of its rivals to the north, the Latin American- and Caribbean-focused retailer needs to ensure that its membership income keeps growing at a pace that reflects customer loyalty and satisfaction with PriceSmart stores.

Learn more about 3-D printing
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Dan Caplinger has no position in any stocks mentioned. The Motley Fool recommends 3D Systems, Bed Bath & Beyond, and PriceSmart. The Motley Fool owns shares of 3D Systems. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.

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