Monday was a good day for the stock market, with major benchmarks finishing with modest gains to sustain the generally bullish sentiment among investors. Some investors remain uncertain about whether proposals on tax reform will be able to get through Congress, but others are getting more confident that extensive negotiations among key leaders will produce a workable solution that can overcome opposition. Yet even amid the positive momentum in the overall market, some individual stocks suffered from bad corporate news. Sears Holdings (OTC:SHLDQ), Immunomedics (NASDAQ:IMMU), and J.C. Penney (NYSE:JCP) 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.
Sears deals with declines
Shares of Sears Holdings dropped 10% following more setbacks for the retailer. Last week was difficult for Sears, as it posted quarterly results that included a 15% drop in comparable-store sales and an even larger decline in total revenue. Yet despite multiple efforts to consolidate and make the most of its business, including extensive store closings and substantial restructurings to emphasize its higher-potential business lines, Sears simply hasn't yet been able to deliver the turnaround that investors want to see. As competitors make aggressive moves to capture business in the holiday season, Sears runs the risk of falling behind, and what happens between now and the end of the year could make or break the retailer's future.
Immunomedics gives back its gains
Immunomedics stock fell 19%, reversing course from the biotechnology company's big jump on Friday. Immunomedics gained ground last week on news that the company had named Michael Pehl to take on the role of chief executive officer. Pehl was formerly a division president at Celgene, giving him the background and experience that many investors wanted to see in a candidate for the top executive job. Yet today's drop suggests that shareholders are now taking a more conservative view toward the company, wanting to see further evidence of success from Immunomedics' developmental treatments before committing wholeheartedly to the stock.
Penney comes back to earth
Finally, shares of J.C. Penney dropped 7%. The department store retailer had also been a big mover on Friday, climbing 15% after reporting results for the third quarter that weren't as bad as some pessimistic investors had feared. Comparable-store sales had climbed 1.7%, topping Penney's own initial estimates for the quarter due to a strong response from promotional events. Yet investors understand that the proof of Penney's turnaround efforts will be how the holiday season goes, and an increasingly competitive promotional environment coming into Black Friday next week will be a critical milestone in seeing whether the retailer is fully prepared to stand up to its peers both in the brick-and-mortar area and in e-commerce.