Stocks had positive day on Tuesday, sending the Dow Jones Industrials to yet another record high and continuing the streak of rising prices on Wall Street. Despite nervousness over the result of this week's Federal Reserve monetary policy meeting and the potential fallout from President Trump's speech to the United Nations General Assembly, investors were content to wait for the coming earnings season to see if economic growth can remain solid going into the end of the year. Despite generally favorable market conditions, some stocks posted sharp losses. Rite Aid (RAD +0.00%), Synchronoss Technologies (SNCR +0.00%), and NuVasive (NUVA +0.00%) 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.
Rite Aid has to change its deal -- again
Shares of Rite Aid fell 12% after announcing that it once again had to change the terms of its proposed agreement with drugstore rival Walgreens Boots Alliance (WBA +0.00%). Under the new deal, Rite Aid will receive $4.38 billion in exchange for selling Walgreens more than 1,900 of its store locations. That sounds good, but it's more than 250 fewer stores than Rite Aid had expected to sell, and the sale price was down by about $800 million. The net result is considerably less money for Rite Aid to use to manage debt and promote growth. The good news is that the deal has finally gotten approval from the Federal Trade Commission, but it's not yet certain whether Rite Aid can produce a successful business outcome with its remaining stores.
Image source: Rite Aid.
Synchronoss sees potential deal disappear
Synchronoss Technologies stock plunged over 41% in the wake of a would-be buyer's decision to break off discussions of an all-cash acquisition. The cloud computing and mobile-backup specialist has been exploring a range of potential strategic options, including a sale of the company, but major shareholder Siris Capital Group said that it's no longer considering an all-cash buyout of Synchronoss. One key problem is that Synchronoss hasn't filed quarterly reports since early this year following the discovery of accounting issues. Although there's nothing that affirmatively refers to any major accounting problem that could have dissuaded Siris from going forward, impatient shareholders are selling first with the intent of asking any questions later.
NuVasive deals with criticism
Finally, shares of NuVasive dropped 7%. The maker of minimally invasive surgical systems focused on spinal procedures was the subject of a negative research report from short-selling analyst GlassHouse Research, which points to recent executive departures and what it calls "accounting irregularities" in arguing that the stock is too highly valued compared to better-established players in the medical device space. GlassHouse claims that an appropriate target price for NuVasive stock would be less than half its current price, but the smaller magnitude of today's drop suggests that most shareholders aren't taking the allegations particularly seriously.
