Tuesday was another good day for stocks on Wall Street. The Dow Jones Industrials climbed further into record territory, flirting with the 22,000 milestone for much of the day. Other major benchmarks had similar returns on a percentage basis, reflecting strength in the global economy and a positive reaction from investors both in the U.S. and around the world. Yet even though the overall mood among market participants was sunny, not every stock was able to join in on the rally. Pitney Bowes (NYSE:PBI), Geron (NASDAQ:GERN), and Cummins (NYSE:CMI) 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.
Pitney Bowes falls as results weaken
Shares of Pitney Bowes dropped 15.5% after the business services specialist reported its second-quarter financial results. The company said that revenue fell 2% from the year-earlier period, and adjusted earnings fell an even steeper 15% from where they were during the second quarter of 2016. The former mail specialist saw its legacy mail business post steep declines, and gains on the e-commerce front were insufficient to produce overall growth. Pitney Bowes also narrowed its guidance, aiming toward the higher end of its revenue projection but toward the low end of its earnings and free cash flow predictions. With the secular decline in traditional mail, Pitney Bowes has worked hard to reinvent its business, but recent hiccups reveal strong competition in the broader business services space that could hurt long-term growth prospects.
Fears about a key treatment hurt Geron
Geron stock declined 15.5% in the wake of worrisome news about the biopharmaceutical company's imetelstat candidate drug for myelodysplastic syndromes and myelofibrosis. The company said that one of its phase 2/3 clinical trials for imetelstat will expand to enroll more patients in a refined population of myelodysplastic syndrome patients in order to confirm clinical benefits and safety observations. The likely reason for the move is to hone in on the population of patients likeliest to get the most from the drug, although some investors are nervous that Geron and its development partner, Janssen, might not see eye to eye with respect to imetelstat's potential. Geron did point out that Janssen has the right to maintain its license rights or give them up following completion of primary analysis from a different study, and it will be interesting to see how the partner responds to whatever results the study produces.
Cummins stalls out
Finally, shares of Cummins lost 6%. The engine manufacturer reported its second-quarter financial results today, and although substantial revenue gains came in above expectations because of unanticipated increases in orders, Cummins' bottom line didn't post the same level of improvement. Higher warranty-related costs were partially responsible for the hit to earnings, but after a big gain in the stock price, investors had really wanted to see far better growth than the company managed to provide. Going forward, Cummins will need to build on its sales success and continue implementing its internal cost management program in order to get its earnings growing more quickly in the future.