Despite the strong start to the day, partially spurred by a strong existing home sales report for June — almost a ten-year high — the bulls couldn’t hold the sellers off. The S&P 500 ended the session at 2165.17, down 0.36%.
That setback was mild compared to the losses booked by Tractor Supply Company (NASDAQ:TSCO), Sherwin-Williams Co (NYSE:SHW) and Southwest Airlines Co (NYSE:LUV) on Thursday, however.
Here’s what investors need to know about the earnings and outlooks that did the damage.
Sherwin-Williams Co (SHW)
Today, paint company Sherwin-Williams dished out second quarter numbers that left a bad taste in investors’ mouths.
Last quarter, Sherwin-Williams earned $4.06 per share on revenue of $3.22 billion. Net income was up 5%, and sales were up roughly 3% from Q2-2015’s report, but per-share profits missed estimates of $4.16, while sales came up short of the expected $3.27 billion.
The company says it doesn’t anticipate better days anytime soon either. Its full-year profit outlook now stands at a range of $11.65 to $11.85 per share of SHW, versus average analyst expectations of $12.68.
SHW ended Thursday down nearly 7%.
Southwest Airlines Co (LUV)
SHW wasn’t the only stock to be up-ended by a disappointing quarterly earnings report on Thursday. The good news is that Southwest Airlines posted a 35% year-over-year improvement in its quarterly profit. The bad news is that nobody was impressed. The evidence: LUV shares plunged more than 11%.
The prod for the selloff was a warning from the airline that revenue could fall as much as 4% in the coming quarter thanks to more competition, and, subsequently, lower ticker prices. Fanning the bearish flames was the revenue and earnings miss. In its second quarter of the year, Southwest Airlines earned $1.19 per share on sales of $5.38 billion, versus expectations for a profit of $1.21 per share of LUV stock and revenue of $5.41 billion.
That said, a second day of computer glitches that’s led to more than 1,000 canceled flights in just two days might be leaving investors wondering if the airline has already set up an ugly Q3.
Tractor Supply Company (TSCO)
Last but not least, the earnings bug also bit Tractor Supply Company today, sending TSCO shares down 3.6% in response.
The Q2 numbers were posted after the close on Wednesday — last quarter, the farming supply outfit earned $1.16 per share on revenue of $1.85 billion. Both were in line with expectations, and both were up a bit from year-ago levels. But, the market may have priced in a beat for both figures.
“While it’s our job to manage the business through changes in weather and other external factors, the extreme weather patterns in the first two months of the quarter simply proved to be too much to overcome in the more seasonal segments of our business. We also do not anticipate that a significant shift in sales will come into the third quarter.”
That lack of revenue shift into the third quarter prompted the company to reiterate its recently lowered full-year outlook. Tractor Supply now expects sales to roll in between $6.8 billion and $6.9 billion in 2016, down a bit from its prior guidance.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
