Major benchmarks saw a lot of ups and downs on Tuesday as investors tried to come to a consensus about the likely future direction of the global economy. Signs of progress in trade talks between the U.S. and China led to early gains, but some broader concerns about various economic issues weighed on enthusiasm later in the session. Some companies had bad news that sent their shares lower. Shake Shack (NYSE:SHAK), Myriad Genetics (NASDAQ:MYGN), and Trivago (NASDAQ:TRVG) were among the worst performers. Here's why they did so poorly.
Shake Shack gets shaken
Shares of Shake Shack fell nearly 21% after the restaurant chain reported disappointing financial results for the third quarter of 2019. Revenue climbed 32% on a 35% rise in unit growth compared to year-earlier levels, showing the continued popularity of the burger specialist. However, same-restaurant sales were up just 2%, and not everyone was satisfied with the $2.2 million increase in Shake Shack's adjusted pro forma net income to $10 million. In addition, the company cut its projections for comparable-sales growth for the full year from 2% to 1.5%. Investors have had high hopes for the restaurant chain, but Shake Shack wasn't able to deliver everything they wanted to see.
Myriad faces new challenges
Myriad Genetics saw its stock plunge 40% following the molecular diagnostics specialist's fiscal first-quarter financial report. Revenue fell 8% year over year, and adjusted earnings per share dropped more than 80% over the same period. CEO Mark Capone characterized the quarter as "a challenging start to fiscal year 2020," pointing to an administrative deletion of current procedural terminology codes as having been far more significant than Myriad had expected. The company expects much higher earnings by the second half of the fiscal year, but investors weren't happy to see that lingering effects could show up again in fiscal second-quarter results.
Trivago moves lower
Finally, shares of Trivago fell 18%. The online travel company saw revenue ease lower by 1% in the third quarter of 2019 compared to the prior-year period, as weakness in the Developed Europe and Rest of World segments offset solid gains in the Americas. Net income declined to just barely above breakeven levels. Trivago continued to emphasize quality over quantity, with total qualified referrals falling 14% but revenue per referral picking up 16%. Nevertheless, investors didn't seem comfortable with the numbers, and news that founder and CEO Rolf Schromgens will turn over the chief executive reins to CFO Axel Hefer might have created some additional doubts about Trivago's future direction.