Wall Street took a hit on Tuesday, with major benchmarks generally seeing losses of 1% to 1.7%. The latest news on the trade front signaled worsening relations between the U.S. and China, and investors seem increasingly uncertain that the two nations will be able to resolve their differences at any point in the near future. That hit some stocks directly, including several Chinese stocks, but others lost ground due to their own individual problems. Ambarella (NASDAQ:AMBA), Qiagen (NYSE:QGEN), and SmileDirectClub (NASDAQ:SDC) were among the worst performers. Here's why they did so poorly.
Ambarella takes a hit in the trade war
Shares of Ambarella fell over 9% after the maker of video camera sensor chips became the latest casualty of the trade conflict. Ambarella provides its chips to several Chinese companies, and two major customers, Dahua and Hikvision, were included among the more than two dozen companies that made it onto the U.S. blacklist. Analysts quickly noted that Ambarella might still be able to make shipments through non-U.S. entities, but those following the video chip maker are concerned that taking away key parts of its business at a critical time in the industry could prove damaging to its long-term prospects.
Qiagen reports results, changes its CEO
Qiagen saw its stock drop 21% after several news items called its strategic direction into doubt. The German healthcare specialist said that CEO Peer Schatz will step down after 27 years with the company, with Qiagen naming an interim CEO while it looks for a permanent chief executive. Qiagen also said preliminary third-quarter sales growth would come in around 3%, which was less than the 4% to 5% growth that it had previously expected. Some investors hope that a strategic collaboration with Illumina will help Qiagen gain traction, but others fear that competition in the industry will make it increasingly difficult to pick up steam -- especially without someone permanently at the helm.
Finally, shares of SmileDirectClub sank 16%. The dental alignment specialist has seen wild moves over the past several days, with comments from short-sellers pushing the stock down only to see it recover when analysts at key underwriting banks gave their support for the company's business model. Today, investors seemed more skeptical of that support, especially after SmileDirectClub decided to issue a statement specifically saying that analysts' reports "reinforce the value of our business model, unit economics, and mission to transform smiles through safe, affordable, and consumer-first technology." The company will have to back up its claims with results, and it'll take a while for investors to get a final answer as to whether SmileDirectClub can compete with rivals in its field.