Thursday was a tough day on Wall Street, as the Dow Jones Industrial Average fell over 200 points and other major market benchmarks saw losses of more than 1%. After weeks of bullishness, investors seemed to lose confidence in the future prospects for the market, and as earnings season hits its peak and starts to wind down, many will be looking more closely at broader macroeconomic issues that could pose problems in the future. Poor results from some key companies sent many stocks sharply lower. Fiat Chrysler Automobiles (NYSE:FCAU), Tapestry (NYSE:TPR), and Proto Labs (NYSE:PRLB) were among the worst performers. Here's why they did so poorly.
Fiat Chrysler sees a tough 2019 ahead
Shares of Fiat Chrysler Automobiles fell 12% after the auto giant reported its fourth-quarter financial results. Revenue climbed 6% from year-earlier levels, sending adjusted net income higher by nearly half. Yet a 6% drop in combined shipments signaled potential problems ahead, and projections for adjusted earnings of 2.70 euros per share in 2019 would be markedly lower than the 3 euros per share that Fiat Chrysler managed to earn in 2018. With the company having to deal with a diesel-engine scandal and other issues, Fiat Chrysler has work to do to get itself back in top gear.
Tapestry gets ripped
Tapestry saw its stock sink 15% following the release of its fiscal second-quarter financial report. The company behind luxury brand names like Coach, Kate Spade, and Stuart Weitzman said that sales rose just 1% from year-earlier levels, and adjusted net income inched higher by 1%. Coach saw a 2% sales gain on a 1% rise in comparable-store sales, but Kate Spade suffered a sharp 11% drop in comparable-store sales, pulling down overall segment revenue by 1%. Investors also didn't seem satisfied with calls for Tapestry to see sales climb at only a low- to mid-single-digit percentage rate in the full 2019 fiscal year. After stronger results from other luxury brand retailers, Tapestry's lackluster performance was especially disappointing.
Proto Labs can't manufacture a strong quarter
Finally, shares of Proto Labs plunged 22%. The quick-turn on-demand manufacturing specialist said that revenue climbed almost 20% in the fourth quarter of 2018, helping to boost net income by 35% compared to the year-earlier quarter. Yet CEO Vicki Holt said that "fourth quarter financial results were below our expectations," with Proto Labs having "experienced a strong start to the quarter in terms of revenue, followed by a weak December." The company is still optimistic that 2019 will see improvements in relationships with key clients and a better customer experience. For now, though, investors are tempering their excitement about Proto Labs' long-term prospects.