What happened
Chart Industries (GTLS +0.02%). Middleby (MIDD +1.36%). Sysco (SYY +0.33%). Trex (TREX +2.53%).
What do a maker of heat exchangers and cooling fans (Chart), a commercial kitchen equipment manufacturer (Middleby), a food distributor (Sysco), and a maker of simulated wood for outdoor construction (Trex) have in common? Not a whole lot, but one thing is that they've all fallen victim to Wednesday's renewed sell-off in the stock markets.
As of 12:15 p.m. EDT today, Trex was least hard hit with a loss of 7.2%, but Chart, Middleby, and Sysco were booking much bigger losses: 29.6%, 20.4%, and 17.2%, respectively.
Image source: Getty Images.
So what
To an extent, this makes perfect sense -- especially in the case of Middleby and Sysco. The coronavirus in general is having a depressing effect on the economy, hurting stocks of all stripes.
Middleby and Sysco, though, may be especially susceptible to the slowdown. Both of these companies cater to the restaurant industry, and as you've no doubt heard by now, restaurants, bars, and similar establishments are being closed all across the country, by government fiat.
Now what
Logically, this will affect Middleby's sales of cooking equipment and Sysco's sales of food to their restaurant customers. How big an effect will depend on how long this crisis lasts, and how quickly shopping patterns adjust to the new take-out order paradigm.
A quicker-than-anticipated end to the restaurant closures or more-rapid adoption of food delivery services such as Uber Eats and Grubhub could be the catalyst to reverse this slide (for two of these stocks, at least).
