Wall Street showed its resiliency once again on Monday, as stock market indexes bounced back from massive losses coming into the beginning of the session to finish much more modestly lower. Rising trade tensions between the U.S. and China were the primary culprit, as President Trump threatened to impose higher tariffs on its key trading partner. Yet even as investors seemed to shrug off the implications of a potential escalation toward a full-blown trade war, some companies dealt with bad news that sent their shares lower. PetMed Express (PETS +0.66%), Chemours (CC 0.88%), and Affiliated Managers Group (AMG +0.27%) were among the worst performers. Here's why they did so poorly.
PetMed is all bark and no bite
Shares of PetMed Express sank 9%, as investors were disappointed with the pet medication specialist's fiscal fourth-quarter financial report. PetMed said that sales for the quarter eased lower by 4% compared to last year's results, and net income was down a much steeper 35% over the same period. CEO Menderes Akdag attributed the lackluster performance to competitive conditions during the quarter, which had the impact of cutting margin levels. PetMed hopes that by investing further in its e-commerce platform and working to build and support brand loyalty, it'll be able to overcome its rivals and build market share. However, investors don't seem so certain, and PetMed will have to reassure shareholders who've already seen poor results in past quarters.
Image source: PetMed Express.
Chemours gets panned
Performance chemicals company Chemours saw its stock drop almost 8% after it became the focus of negative comments from analysts. At the Sohn Investment Conference, Glenview Capital's Larry Robinson said that he has sold Chemours short, adding to earlier action from other well-regarded institutions. JPMorgan cut its rating on Chemours from overweight to neutral and reduced its stock price target by $6 to $40 per share, noting that sales volume has already fallen dramatically in the first-quarter results it released last week. RBC Capital followed suit with a price target cut from $50 to $43, but it believes that a recovery in titanium dioxide later in the year could help Chemours bounce back. Overall, sentiment on the chemical company remains weak, and Chemours will have to prove it can overcome difficult conditions and thrive once again.
AMG deals with market turmoil
Finally, shares of Affiliated Managers Group fell nearly 12%. The asset management company said that revenue and profit were both down during the first quarter of 2019, as AMG suffered from continued investor outflows even as financial markets bounced back from their poor performance toward the end of 2018. AMG has worked hard to shore up its business from a strategic standpoint, identifying new potential partners to deliver better returns to investors while implementing an executive transition plan. Yet until an expected upturn stemming from the market's recovery in 2019 actually takes shape, investors in AMG seem prepared to remain skeptical.
