Wednesday was a good day for the stock market, as investors celebrated the potential gains in profit if the proposed Trump tax plan becomes law. With the proposal including dramatically lower corporate tax rates and special maximum rates on pass-through business entities, bullish investors are hopeful that the stimulus to corporations' bottom lines will be enough to create large boosts to share prices. Yet even with major benchmarks climbing toward record highs, downbeat news from several companies weighed down some of the positive spirit. Tile Shop Holdings (NASDAQ:TTS), Veritone (NASDAQ:VERI), and Intra-Cellular Therapies (NASDAQ:ITCI) 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.
Tile Shop hits the floor
Shares of Tile Shop Holdings sank nearly 17% after the company got an unfavorable review from a major stock analyst company. Analysts at Piper Jaffray downgraded the stock of the home-improvement retail specialist from overweight to neutral, citing poor business performance during the first part of 2017 and expectations for continued weakness in the immediate future. The analysts also reduced their price target on the stock, but today's drop takes Tile Shop Holdings shares well below that level. If the company can overcome some of its near-term headwinds and remain on course with a broader strategic vision, then Tile Shop could make today's drop look short-sighted from traders without a long-range perspective.
Investors sour on Veritone
Veritone stock plunged 30% in the wake of a negative comment from the noted short-selling company Citron Research. Citron released a short tweet today, suggesting that Veritone's reputation as an artificial intelligence technology company is misleading and that the stock is likely to lose most of the gains it has posted in the recent past. Artificial intelligence has been a popular place to invest lately, and recent publicity sent Veritone's stock sharply higher. Yet Citron has been right about other negative calls in the past, and so its call for the stock to lose more than half its value even from current levels was especially worrisome for some shareholders.
Intra-Cellular plans a secondary offering
Finally, shares of Intra-Cellular Therapies dropped 13%. The biopharmaceutical company said late yesterday that it would do a secondary offering of stock, seeking to raise about $150 million from the sale. The news comes after a couple of big moves higher for shares, with Intra-Cellular announcing favorable regulatory news regarding its lead compound lumateperone as well as subsequent positive trial results in treating schizophrenia. Secondary offerings are common for small drug companies after positive results, as they typically need ample cash reserves to fund clinical trials and move candidate drugs through their pipeline toward approval. Even with the momentary blip downward, Intra-Cellular shareholders are still excited about lumateperone's long-term prospects.