Wall Street had a down day on Thursday, with the trade-sensitive industrial side of the market seeing the largest declines on news that the U.S. and Canada had imposed a set of matching tariffs on each other. The Dow lost more than 200 points, but declines were somewhat less extensive on a percentage basis for other parts of the market. Crude oil prices also moved lower, and the general sense among investors was one of uncertainty about how these initial disputes would evolve over time. Moreover, some bad news from key sectors of the economy weighed on individual stocks. Dollar Tree (NASDAQ:DLTR), Guess? (NYSE:GES), and Micron Technology (NASDAQ:MU) 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.
Dollar Tree cuts its 2018 guidance
Shares of Dollar Tree plunged 14% after the dollar-store retailer announced its fiscal first-quarter results. The company said that revenue rose 5%, with Dollar Tree stores reporting a 4% rise in same-store sales. Yet the company's Family Dollar stores underperformed, posting a same-store sales decline of 1.1% compared to the year-ago quarter. Executives blamed the subpar results on a cold spring, an early Easter holiday, and higher freight costs for moving goods to its store locations. Yet although the company said warmer weather has helped the business recover, Dollar Tree still cut its earnings projections for the full year, and investors seemed to ignore the potential long-term positives of strategic moves like refinancing its debt. The news came as a surprise to those who've seen dollar stores as outperforming their upscale rivals.
Guess?'s disappointing quarterly results
Guess? stock lost nearly 20% in the wake of the jeans maker's fiscal first-quarter financial report. At first glance, things looked good for the company, which posted a 15% rise in revenue. But net losses narrowed only slightly from year-ago levels, and the key Americas retail segment suffered sales declines. Investors also seemed uninspired by the guidance that Guess? gave, even though it was higher in some respects than what the retailer had predicted just a few months ago. With the stock having posted such big gains leading up to the report, investors seemed disappointed that the jeans maker hadn't made more progress in growing its fundamental business.
Micron looks pricey
Finally, shares of Micron Technology fell 8%. The memory chip specialist got an unfavorable review from analysts at Morgan Stanley, with the analyst firm saying that the stock's valuation is excessively high at current levels. The analyst downgraded its rating on Micron from overweight to equal weight, saying that even though the DRAM memory chip market still looks favorable, any further gains appear to be already incorporated into the stock's valuation. After such a huge run higher for the chipmaker's stock, it's logical for investors to fear the next cyclical downturn in the memory market and how it could affect Micron shares going forward.