The broader stock market didn't move sharply on Monday, leaving key indexes like the Dow, S&P 500, and Nasdaq Composite all down about 0.2% on the day. The peak of the first-quarter earnings season will hit this week and next, and so far, investors have gotten a mixed view of how corporate America is faring. Although some companies have done much better than many had feared, concerns still exist about whether the overall economy can sustain solid growth rates even as the rest of the world languishes in less favorable economic conditions. Helping to lead the stock market lower today were more substantial losses in companies including Perrigo (NYSE:PRGO), U.S. Steel (NYSE:X), and GoPro (NASDAQ:GPRO).
Perrigo plunged 18% after the company announced preliminary first-quarter results, updated guidance, and announced the departure of its chief executive officer, Joseph Papa. Papa resigned from his post at Perrigo to go to controversy-plagued Valeant Pharmaceuticals in a move that had been rumored over the past week. Yet arguably more important was the drug-seller's downbeat pre-announcement, which included revenue and earnings projections that were well short of the consensus forecasts among investors. Perrigo cited reduced pricing expectations in its prescription segment and weaker-than-expected performance within its branded consumer healthcare segment. After the decline, Perrigo stock has lost half its value just since August 2015, and few are certain whether the company will be able to regain its positive momentum quickly.
U.S. Steel finished the day down 7%. The steelmaker will announce its earnings on Tuesday, and most investors are bracing for a drop in revenue of more than 20% and a massive widening of its losses compared to the year-earlier quarter. Many industry analysts are watching how U.S. Steel is looking to renegotiate contracts with suppliers of iron ore, which have been under considerable pressure because of weak steel-making demand and plentiful supplies following production increases. Even with the industry obstacles in its path, U.S. Steel has seen its stock regain considerable ground on hopes that poor conditions will soon reverse themselves. Yet looking forward, it's far from certain that recent price increases for steel products will be sustainable, and it will be interesting to see whether U.S. Steel's future guidance in its report tomorrow will be favorable.
Finally, GoPro fell 8%. The maker of sports- and action-camera equipment responded negatively to analyst assertions that the company will struggle to broaden its customer base beyond its traditional core group of specialty sports enthusiasts. GoPro is working hard to offer new products in an effort to try to attract a new set of buyers, but some fear the company's ability to offer support to new users in order to encourage them to produce and post video content shot on GoPro camera equipment could prove insufficient. GoPro shares have fallen 80% from recent highs as investors have questioned what the company will do to follow up on its early success. Until those answers come, GoPro stock will likely remain under pressure.