Thursday was a largely positive day on Wall Street, and most major indexes moved modestly higher. Small-cap stocks showed particularly sharp gains, highlighting the perceived likelihood of moves to help support the domestic economy even as multinational corporations remain under pressure from potential trade issues. Investors are increasingly looking forward to the G-20 summit over the coming weekend, with expectations that a trade deal could send the market soaring even further. Yet some stocks missed out on today's rally and lost ground. Conagra Brands (CAG -0.59%), Patterson Companies (PDCO 0.79%), and Zynex (ZYXI 0.72%) were among the worst performers. Here's why they did so poorly.
Conagra leaves investors hungry
Shares of Conagra Brands fell 12% after the food giant reported its fiscal fourth-quarter financial results. Sales soared 34% from year-ago levels, but all of that growth came from the acquisition of Pinnacle. After accounting for that purchase and the divestiture and sale of various other business units, organic net revenue was down 0.7%. CEO Sean Connolly also pointed to a tough promotional environment and manufacturing issues as holding back the company's growth. In the long run, Conagra sees its strategy working out well, and even though the food giant boosted its guidance for organic sales growth over the coming fiscal year, investors seemed disappointed with the challenges the company still faces.
Patterson sees potential trouble ahead
Animal health and dental products distributor Patterson Companies saw its stock fall 5% following its release of its fiscal fourth-quarter financial report. Revenue for the period came in 2.6% higher than in the previous year's quarter, with reasonably solid performance from both of its key business segments. Bottom-line gains of 24% on an adjusted basis were also encouraging, but investors had hoped for an even larger earnings jump of about 30%. Moreover, Patterson's guidance for the coming fiscal year was a bit weaker than most of those following the company had expected. With Patterson stock still down by half since 2017, the company needs to boost its business quickly to regain investor confidence.
Zynex finally falls back
Finally, shares of Zynex plunged 17%. The high-flying medical device company filed a prospectus with the U.S. Securities and Exchange Commission, allowing its selling stockholders to sell roughly 16.7 million shares. Zynex itself won't receive any proceeds from the offering, instead giving CEO Thomas Sandgaard an opportunity to sell off roughly half of the 31.6 million shares he directly or indirectly holds. Zynex stock had doubled just since late April on hopes that its non-invasive medical devices for pain management will gain acceptance, but shareholders seem worried that the move to sell means that Sandgaard won't be as interested in the business going forward.