Why Zulily, Bunge and Panera Bread Are 3 of Today’s Worst Stocks

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Spurred by little more than renewed hope that the Greece debt impasse will end gently, stocks broke out of a near-trading range on Thursday, and in some cases moved to new multi-year highs.

It wasn’t sunshine and roses for every stock, however. Bunge Ltd (NYSE:BG), Panera Bread Co. (NASDAQ:PNRA) and  Zulily Inc (NASDAQ:ZU) were all backpedaling today thanks to numbers that were more than a little alarming.

Zulily (ZU)

Why Zulily Inc., Bunge Ltd and Panera Bread Co. Are 3 of Today's Worst StocksJust when it looks like things couldn’t get any worse for Zulily, they get worse.

Through yesterday, shares of online-shopping name Zulily had fallen 73% from their peak price of $73.50 hit in February of last year. Disappointing results were the core cause for the pullback.

The selloff reached 80% today, with ZU stock giving up another $5.24 to close at $14.5 … another new low.

The prod for Thursday’s pullback was — surprise, surprise — more disappointing results. The company posted a profit of 11 cents per share, versus expectations for a profit of 14 cents per share of ZU stock. Revenue of $391.35 million fell short of the expected $405.5 million for the fourth quarter of 2014. Guidance for the current quarter was similarly unimpressive.

A wave of downgrades soon followed the announcement, including one from Canaccord Genuity’s Michael Graham, who noted:

“Zulily reported soft Q4 results marked by weakness on most metrics, including customer growth and order frequency. 2015 guidance implies a dramatic revenue growth deceleration to 30% down from 72% in 2014, and well below our prior 48% estimate. On the bright side, the company announced a $250M, 2-year buyback. While we still see a potentially big opportunity ahead for Zulily, we believe there is enough near-term uncertainty to warrant a lower rating.”

Bunge (BG)

Shares of food company Bunge took a 12% hit on Thursday after the company reported earnings that fell short of expectations. Wall Street was looking for a profit of $2.51 per share of BG stock for the company’s fiscal fourth quarter, but Bunge only reported a profit of $1.20 per share, down from $1.35 in the fourth quarter of 2013.

On a whole-dollar basis, the company reported a fourth quarter profit of $82 million, versus a bottom line of $115 million in the same quarter a year earlier. Revenue also fell short of estimates. Analysts had projected a top line of $16.7 million, but Bunge only produced sales of $13.9 billion.

While alarming on the surface, it should be noted that Bunge lost $80 million on hedges last quarter, which ate directly into the bottom line. It’s also worth noting that 2013’s crop yields were outstanding, raising the comparative bar unfairly high this time around.

Panera Bread (PNRA)

The good news: Panera Bread topped its fourth-quarter earnings estimates. The bad news: Panera Bread still posted an 11% decline in year-over-year income for Q4. Guidance served as the tie-breaker, and investors sent PNRA stock lower to the tune of 10% on Wednesday.

The specifics: Last quarter, Panera Bread generated a profit of $1.87 per share on $672.5 million in revenue. Analysts were expecting a bottom line of $1.82 per share of PNRA stock on $675.1 million in sales.

There was no positive spin on any of the numbers that was going to alleviate the worry spurred by the company’s 2015 outlook. Panera Bread foresees flat to modestly declining per-share income in 2015 as it spends to improve the speed of service in its sandwich shops. More employees at critical times is one of those costly measures.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2015/02/zulily-bunge-panera-bread-3-todays-worst-stocks/.

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