Monday was a mixed day for the stock market, with strength in major technology stocks lifting the Nasdaq Composite to gains of nearly 0.75% even as the S&P 500 settled for smaller gains and the Dow posted modest losses. Earnings season continued to drive market sentiment, and the broader picture of economic prosperity kept many investors bullish even in the face of uncertainty about government policy going forward. Despite a generally positive tone, however, some stocks gave up ground today. Intra-Cellular Therapies (NASDAQ:ITCI), Wesco Aircraft Holdings (NYSE:WAIR), and Radius Health (NASDAQ:RDUS) were among the worst performers on the day. Below, we'll look more closely at these stocks to tell you why they did so poorly.
Intra-Cellular takes a hit
Shares of Intra-Cellular Therapies fell 24% after the company released a corporate update on the status of its lumateperone treatment for schizophrenia. The biopharmaceutical company said that the U.S. Food and Drug Administration had confirmed that the results of a study of lumateperone don't preclude Intra-Cellular from filing a new drug application for the drug. However, the FDA raised some questions with respect to certain toxicology studies of the drug, and the agency requested additional information to confirm that there's not a safety risk in using the drug. Investors weren't happy with that mixed outcome, even though Intra-Cellular still believes that it can submit the drug for approval by the middle of next year. With concerns that the market for schizophrenia treatments is already crowded, some believe that the delay could pose new problems for Intra-Cellular going forward.
Wesco loses altitude
Wesco Aircraft stock finished the day down 18% in the wake of announcements of management changes and preliminary financial information. Late Friday, the distributor of supply chain management solutions to the global aerospace industry said that CEO David Castagnola had retired from the company, and that Todd Renehan had taken over as new CEO going forward. Also, Wesco said that it anticipates sales of $364.6 million, with adjusted earnings likely to come in at $0.21 per share. Both figures were substantially below what investors had expected from Wesco, despite the fact that shareholders were already prepared to see a drop in year-over-year earnings and only flat top-line performance.
Radius looks less healthy
Finally, shares of Radius Health dropped 10%. The biopharmaceutical company said that it posted a larger loss than most investors were expecting, with net losses of $56.9 million working out to $1.32 per share. Radius said that the roughly 40% increase in its losses came from rising overhead expenses, with declines in research and development spending only partially offsetting the higher costs elsewhere. That news outweighed the positive sentiment from a recent FDA decision to approve the company's Tymlos treatment for osteoporosis, which has the enviable status of being the first bond-building therapy to receive FDA approval in nearly 15 years. Shareholders appear to be focused on the short run right now, but if Tymlos takes off, today's drop could give way to bigger long-term gains in time.