A third bullish day in a row was enough to push the S&P 500 within striking distance of an all-time record high on Friday. Although it didn’t quite reach a new high, and then even peeled back from the high of 2077.85 it did manage to make, investors cant’ complain about this week. All told, the S&P 500 bounced 5% off its lows hit on Tuesday, circumventing a big pullback before it had a chance to get going in earnest.
It wasn’t necessarily a winner for every equity out there, however. EQT Corporation (EQT), Foot Locker, Inc. (FL) and Hasbro, Inc. (HAS) dipped pretty deep into the red ink today. Here’s what investors need to know about these big meltdowns.
Foot Locker (FL)
Foot Locker stumbled nearly 7% on Friday after Nike Inc. (NKE) reported its order growth pace was slowing down. Nike specifically reported its orders as of the end of the second quarter were only up 11% compared to year-ago levels … the weakest year-over-year comparison for the past year. Analysts were expecting Nike to report an 11.3% uptick in orders for its Q2.
The market extrapolated that lull and figured slower orders for Nike could also only mean tapering business for Foot Locker, not to mention smaller rival Finish Line Inc. (FINL), which was off a whopping 18% today after falling short of earnings expectations in its previous quarter, putting even more pressure on FL stock.
Hasbro (HAS)
Christmas time may the most lucrative time of year for the toy industry, but Hasbro left some coal under investors” Christmas trees today. HAS stock fell 6.4% on Friday, and was followed by competitor Mattel, Inc. (MAT), which fell 6.4% as well. Both were in the hot seat, though.
For Hasbro, the weakness was mostly spurred by a downgrade from BMO Capital Markets, which lowered its target price on HAS stock from $57 to $55. Though the BMO downgrade specifically applied to Hasbro stock, the analyst comments were just as alarming to owners of MAT stock:
“In the fourth quarter it appears the domestic toy industry has taken a turn for the worse, declining about 2% after being up nearly 4% over the first nine months. Furthermore, we believe Hasbro has been losing share to competitors, most of them privately held, and has seen domestic retail slide by 7% so far in the quarter.”
BMO did go on to specifically target MAT stock, however, saying:
“Furthermore, we believe Mattel has been losing share to competitors, most of them privately held, and has seen domestic retail slide by 12% so far in the quarter.”
EQT Corporation (EQT)
Despite crude oil’s ongoing rebound effort, the market is still not overly optimistic on all energy stocks. Though the oil and gas sector was up 2.3% today, a handful of these names found themselves in the red, led by EQT Corporation, down 2.3%. There was no particular prod or reason for the selective weakness within the energy industry. As was noted, most were up, following the lead of crude’s $3.60 gain to a close of $59.02 per barrel. All told, oil closed up 6.5%.
Cabot Oil & Gas Corporation (COG) was also surprisingly deep in the red on Friday, off by 2.0%.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
