Investors seemed to be in a sector-shifting mood on Friday, because various measures of stock market performance went in different directions. Some areas of the market, including small-cap stocks and big technology names, were largely lower for the day. Yet the Dow Jones Industrial Average set another all-time high, and the broadest benchmarks stayed close to unchanged. Even so, amid the cross-currents of the market, some stocks suffered substantial losses, with a particular emphasis on those that had seen impressive gains recently. GTx (NASDAQ:GTXI), Tilray (NASDAQ:TLRY), and United Natural Foods (NYSE:UNFI) were among the worst performers on the day. Here's why they did so poorly.
GTx suffers a major setback
Shares of GTx plummeted more than 90% after the tiny pharmaceutical company announced bad news for its sole candidate drug treatment. A phase 2 trial of enobosarm, which GTx had hoped to position as a treatment for urinary incontinence, failed to meet its primary endpoint of demonstrating statistically superior reductions in daily incontinence episodes compared to patients taking a placebo. Going forward, GTx will have to reposition itself quickly, taking available cash to look at potential candidates that haven't even entered clinical trial testing yet. That means a long wait for shareholders, and given today's moves, many of them seem unwilling to stand for the delay given the risks involved.
Tilray goes on a bum trip
Shares of Tilray plunged another 30%, adding to losses from Thursday and continuing the marijuana stock's roller-coaster week. Most of those who follow the cannabis industry believe that Tilray has exhibited classic behavior for a stock going through a short squeeze, including parabolic gains in a short period of time, a small number of shares available for trading, and high levels of short interest among those who are skeptical about the stock's long-term prospects. Yet with no new shares expected to be available to trade for a while, investors can expect volatility to continue. Even after a decline of almost 60% from its highest levels on Wednesday, Tilray is still up more than fivefold just since its July IPO.
United Natural deals with higher costs
Finally, United Natural Foods stock fell 8.5%. The natural foods distributor reported fiscal fourth-quarter financial results that included sales gains of 11% and a smaller 6% increase in adjusted earnings per share. Yet that pace of growth wasn't quite as strong as those following the company had expected, and United Natural pointed to pressures like higher freight costs in holding back its bottom-line performance. Some investors aren't sure how the acquisition of grocery store chain SUPERVALU help United Natural, and with the potential for difficulty in meeting guidance for the full year, shareholders seem nervous about the long-term vision for the natural foods distributor.