It was another wishy-washy day for stocks, with traders still hungry for some sort of news catalyst that will get them off the fence. After spending a little time into the black and spending a little time in the red, the S&P 500 ended the day at 2181.74, up only 0.04%.
It wasn’t a sleepy day for all stocks, however. BioMarin Pharmaceutical Inc. (NASDAQ:BMRN), Norwegian Cruise Line Holdings Ltd (NASDAQ:NCLH) and Wayfair Inc (NYSE:W) were all deep in the red, albeit for understandable reasons.
Here’s what you need to know.
BioMarin Pharmaceutical Inc. (BMRN)
Late last week, BioMarin Pharmaceutical looked like it was on top of the world. The company posted an operating profit of 9 cents per share on $300 million worth of revenue, handily topping estimates for a loss of 51 cents per share of BMRN and sales of $280.4 million. Better still, the company reeled in the range for its expected loss in 2016, from between $75 million and $100 million to only a loss of between $30 million and $50 million.
The bullish response to the news added another 6% to the 24% gain BMRN had logged since late June, and shares have continued to edge higher in the meantime, further cementing the new rally in place.
So what is the cause of today’s near-4% dip? The company announced that after Monday’s close it would be raising funds through a secondary offering, diluting current BMRN shareholders.
The offering will be for 7.5 million shares of BMRN, versus a current float of 162.25 million … or roughly the same 4% the stock fell today.
Norwegian Cruise Line Holdings Ltd (NCLH)
Norwegian Cruise Line Holdings cautioned its shareholders today that its 2016 may not look as good as previously thought, sending NCLH down nearly 12% as a result.
Neither of the company’s concerns are surprising. Between the adverse economic impact that the Brexit may bring with it, as well as a resurgence of terrorist activity in Europe, demand for luxury travel is crimped, and could be for a while.
Given the new headwinds, Norwegian Cruise Line Holdings now believes it will only earn between $3.35 and $3.45 per share of NCLH this year, versus analyst’s estimates of $3.72.
Wayfair Inc (W)
Last but not least, the good news is that Wayfair saw strong sales growth last quarter. The bad news is, despite rising revenue, the company’s loss got bigger.
In its second fiscal quarter of the year, online shopping venue Wayfair reported a loss of 43 cents per share on revenue of $786.93 million. The top line grew 60% from last year’s $491.75 million, but the loss widened from the loss of 23 cents per share of W posted in the same quarter a year earlier. Analysts were only looking for a loss of 41 cents per share.
The disparate moves not only surprised investors, but also left them wondering if Wayfair can only grow the top line by taking larger losses. Not wanting to find out the hard way, they sold W in droves, sending it to a loss of 19.6% for the day.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
