Despite a disappointing drop in last month’s housing starts and building permits, most investors’ eyes continue to focus on tomorrow’s big interest rate decision from Janet Yellen and the Federal Reserve’s governors. By the time the closing bell rang, the S&P 500 was at 2139.76, up a mere 0.03%, and still parked squarely between strong support and resistance.
Not every stock managed to drift sideways though. GoPro Inc (NASDAQ:GPRO), Deutsche Bank AG (USA) (NYSE:DB) and Sprint Corp (NYSE:S) each found a way to make noticeably lower lows.
Here’s what investors need to know.
Sprint Corp (S)
Despite the optimism Sprint CEO Marcelo Claure tried to exude at the Goldman Sachs Communacopia Conference today, the market wasn’t buying it … literally and figuratively.
The wireless carrier has been attempting a much-needed turnaround for over a year now, and giving credit where it’s due, the company’s work has created a couple of glimmers of hope. Claure made a point of saying he was happy with where the organization was going. He even added that the carrier’s pre-orders for the new iPhone 7, from Apple Inc. (NASDAQ:AAPL), was incredibly strong, rolling in five times higher than the pre-order tally counted for the iPhone 6s a year ago.
Yet, S shareholders were unable to overlook the fact that in spite of Claure’s bullish game face, the company is losing an inordinate number of subscribers to T-Mobile US Inc (NASDAQ:TMUS). All told, T-Mobile has siphoned off 300,000 Sprint customers in the third quarter so far, which is on the order of the number it attracted away from AT&T Inc. (NYSE:T) and Verizon Communications Inc. (NYSE:VZ) despite Sprint having a much smaller pool of subscribers to pick off.
S ended the day down 6.7%.
Deutsche Bank AG (USA) (DB)
For the third trading day in a row, German bank Deutsche Bank found itself on the daily “Worst 3” list, with DB shares logging a 4.2% dip on Tuesday.
There was no new prod for the pullback today. Rather, the previous ones continue to get traction. Those include Friday’s report that Deutsche Bank was on the hook for as much as $14 billion worth of fines imposed by the Department of Justice, and Monday’s news that Deutsche Bank was selling $5.5 billion worth of its loans to beef of its capital position … possibly in anticipation of a hefty fine.
Although Deutsche Bank is probably right in that it won’t actually be forced to cough up the full $14 billion, DB shareholders know that even a fraction of that potential penalty could be debilitating. The sale of the loans isn’t a sign of strength.
GoPro Inc (GPRO)
Finally, although the new GoPro Karma drone was mostly met with positive reviews when it was unveiled on Monday (prodding GPRO shares higher as a result), having had a night to sleep on it, the market decided it just wasn’t impressive enough to believe it will revive the struggling company enough to actually merit owning the stock.
One of the stumbling blocks is the Karma’s price. It retails for $800, without the camera. Adding a camera to the mix leads to a price tag north of $1,000 for a complete setup. Lesser-but-similar setups can be had for half that price. And, comparable-quality (and even better) camera-ferrying drones like the DJI Phantom 4 can be bought for roughly the same amount.
GPRO ended the day down nearly 7%, with most investors deciding the company’s drone was a nice-to-have, but not the must-have that GoPro needed it to be.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
