What started out as a solid day for stocks didn’t finish that way. Up as much as 1.4% at one point on Tuesday, the S&P 500 ended today in the red to the tune of 0.26%. Crude oil hit yet-another multi-year low thanks to today’s 0.4% tumble, though oil had been off as much as 1.5% during Tuesday’s trading.
The worst of the worst were GoPro Inc. (GPRO), Goodyear Tire & Rubber Co. (GT) and Buckle Inc. (BKE), posting some of Wall Street’s biggest meltdowns of the day. Here’s what investors need to know.
GoPro (GPRO)
Wearable-camera company GoPro just can’t get a break.
After bouncing back from a steep selloff in December and hinting it was ready to move higher following the injection of about 15 million newly-free-trading shares, the sellers went back to work. GPRO stock is down 25% since January 2nd, thanks to today’s 12% plunge.
The setback was sparked by news that Apple Inc. (AAPL) was granted a patent for a similar, action-oriented wearable camera system. The buzz is, the Apple patent specifically describes a mount that allow for attachment to a variety of objects like a helmet or the handlebars of a bicycle. That’s one of the vulnerabilities of the GoPro patent.
Goodyear Tire & Rubber (GT)
The good news is, Goodyear Tire & Rubber believes its Q4 cash flow is going to be better than first thought. The bad news is, that’s the only good news there was about GT stock today when it warned shareholders full-year 2014 results were going to be disappointing.
The company had previously projected operating income growth of somewhere between 10% and 15%. Challenges in Europe in addition to the impact of a strong U.S. dollar, however, is likely to lead to fourth quarter income that’s 15 to 20 cents lower per share of GT stock than was projected when Q3’s results were published.
GT stock finished the session down 7%.
Buckle (BKE)
In retrospect, it looks like a trap set by the bears, knowing the bulls would fall into it.
Shares of trendy apparel retailer Buckle gained 26% between early October and Monday, suggesting investors were certain the company would have a strong holiday-shopping season. And sure enough, it did. Last week, Buckle reported a 2.5% increase in same-store sales for the five-week stretch between Thanksgiving and Christmas, with total company sales growing 5.4% in the same period.
BKE stock continued higher after the announcement too, gaining more than 6% following the news. It looks like all the recent buyers decided yesterday’s price was as good as it was going to get for a while, though, pulling the rug out from underneath BKE stock today…. in spades. BKE stock fell nearly 6% on Tuesday.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
