Wednesday was a solid day on Wall Street, as market participants were upbeat about what they saw as favorable indications that U.S.-China relations might not be as bad as yesterday's move from the White House suggested. Yet macroeconomic concerns still plague investors, and many companies have had to deal with headwinds that they're finding difficult to overcome. Some individual stocks got hit especially hard, and U.S. Steel (X -0.81%), James River Group Holdings (JRVR -2.73%), and iRobot (IRBT 11.19%) were among them. Here's why they did so poorly.
U.S. Steel restructures
Shares of U.S. Steel fell more than 8% after the steelmaker said that it would implement what it called an "enhanced operating model and organization structure." The move is designed to help it serve customers more effectively while boosting the speed of its previous strategic transformation efforts. CEO David Burritt believes that the decision will help the company stay competitive in global markets. However, investors weren't happy to see CFO Kevin Bradley announce his resignation, and even though he'll stay on through the end of 2019, the departure signals some potential discord as U.S. Steel seeks to put itself in the best possible position within the industry.
Image source: U.S. Steel.
James River takes a hit
Insurance company James River Group Holdings saw its stock plunge nearly 23% following news that one of its largest customers will cancel all of its insurance policies early. Rasier LLC, which is the commercial auto insurance provider behind Uber, has done a lot of business with James River in the excess and surplus insurance segment, and most of the policies that the two companies had worked on together were due to expire at the end of February 2020. CEO Adam Abram said that the relationship hadn't been as profitable as expected. Investors also weren't pleased to hear that adverse claims development will hurt third-quarter results.
iRobot runs into a downgrade
Finally, shares of iRobot lost 3%. The robotic vacuum maker got negative comments from analysts at Raymond James, who cut their rating on iRobot from market perform to underperform. For a long time, iRobot was the pioneer in robotic home appliances, but there's been considerable competition from new entrants recently. Raymond James called out competing company Shark as a particularly strong threat, and as these devices become more of a commodity, it'll be tough for iRobot to maintain healthy margin levels. Robots and other connected devices in homes are still the wave of the future, but iRobot has to stay innovative in order to compete.
