Please ensure Javascript is enabled for purposes of website accessibility

Why Activision Blizzard, Teladoc Health, and Welbilt Slumped Today

By Dan Caplinger – Nov 5, 2018 at 4:32PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Find out what went wrong with these companies.

Monday was another volatile day for the stock market, with some major benchmarks posting substantial gains even as others gave up ground. Some of the world's largest technology stocks remained under pressure as their growth potential came into question, but other more cyclical stocks like those that dominate the Dow Jones Industrial Average saw more favorable moves. Investors are trying to stay optimistic in general, but as the bull market nears the end of its 10th year, some think its days are numbered. Activision Blizzard (ATVI 0.91%), Teladoc Health (TDOC 7.02%), and Welbilt (WBT) were among the worst performers on the day. Here's why they did so poorly.

Nerves hit Activision

Shares of Activision Blizzard gave up 7% as investors in the video game giant seemed to get a case of nerves in advance of the company's release of its third-quarter financial results later this week. By most standards, the latest installment of the Call of Duty franchise has done extremely well, but some still wish that the game had been able to live up to all of the hype that surrounded its rollout last month. In addition, shareholders will look closely for early signs of whether competitors are taking market share. In a cutthroat industry, Activision has done well, but today's drop shows that it's far from a sure thing that the video gaming company will manage to deliver the performance that investors want to see.

Mechanized soldiers fighting on a dark battlefield with Call of Duty logo.

Image source: Activision Blizzard.

Teladoc gives up its gains

Teladoc Health stock dropped 13%, essentially giving back all of the ground that it had gained last week. Teladoc's jump came in the wake of its third-quarter financial report late Thursday, in which the virtual healthcare specialist said that revenue soared more than 60% from year-earlier levels. Despite suffering a net loss for the quarter, Teladoc shareholders seemed comfortable that an 18% rise in paid membership pointed to further growth ahead. Yet the stock's swing downward today reflects less tolerance among investors for companies without proven profits at present, and Teladoc should expect more volatility in its stock price as long as the overall market's skepticism of future potential stays intact.

Welbilt spins lower

Finally, shares of Welbilt plunged 26%. The maker of restaurant equipment reported third-quarter results that included solid gains in sales and adjusted earnings, and it said that demand for its KitchenCare aftermarket product line and strong sales activity to large chain customers was able to overcome weakness in its refrigeration and freezer equipment business. However, Welbilt wasn't able to avoid seeing negative impacts from the imposition of tariffs, and that awakened fears that further trade tensions could put even more pressure on the company's ability to sustain growth and build positive momentum in the years to come.

Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Activision Blizzard. The Motley Fool recommends Teladoc. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Activision Blizzard, Inc. Stock Quote
Activision Blizzard, Inc.
ATVI
$75.54 (0.91%) $0.68
Teladoc Health, Inc. Stock Quote
Teladoc Health, Inc.
TDOC
$28.50 (7.02%) $1.87
Welbilt, Inc. Stock Quote
Welbilt, Inc.
WBT

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
327%
 
S&P 500 Returns
105%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/28/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.