Why Valeant Pharmaceuticals Intl Inc (VRX), Barrick Gold Corporation (USA) (ABX) and Autodesk, Inc. (ADSK) Are 3 of Today’s Worst Stocks

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Inspired by reports that OPEC had come to an agreement to curb its oil output as a means of propping up floundering crude prices, stocks got Wednesday started on a rather bullish foot. They just didn’t end it that way. By the time the closing bell rang, the S&P 500 was back in the red by 0.27%, closing at 2,198.81.

Why Autodesk, Inc. (ADSK), Valeant Pharmaceuticals Intl Inc (VRX), Barrick Gold Corporation (USA) (ABX) are Three of Today's Worst StocksIt was even worse for shareholders of Valeant Pharmaceuticals Intl Inc (NYSE:VRX), Autodesk, Inc. (NASDAQ:ADSK) and Barrick Gold Corporation (USA) (NYSE:ABX).

Here’s why these three names led the bearish parade on Wednesday.

Barrick Gold Corporation (USA) (ABX)

Just when it looked like gold prices might be ready to recover, a strange piece of news comes along to upend the budding effort. Gold prices plunged 1.44% on Wednesday (closing near $1,171 per oz.) when the U.S. Dollar Index jumped 0.6%. The U.S. dollar is once again within reach of multi-year highs.

While the dollar’s surge took a toll on gold prices — since gold is priced in U.S. dollars — it took an even bigger toll on highly leveraged gold miners like Barrick Gold. ABX lost 2.7% of its value.

It’s not entirely clear if the dog is wagging the tail or if the tail is wagging the dog, but the rise of the U.S. dollar on Wednesday was in step with the surge in bond yields. Yields rose in response to OPEC’s decision to curtail oil production, which in turn could spur inflation. Such inflation should theoretically drive demand for gold and for gold miners like ABX, as gold serves as protection against inflation.

That relationship, however, has been messy for a while.

Autodesk, Inc. (ADSK)

Whether software company Autodesk topped its Q3 earnings estimates or fell short of them depends on who you ask, and what you count. The company reported a GAAP loss of 18 cents per share, versus analyst expectations for a loss of 24 cents per share of ADSK. Or, on an operating basis it lost 42 cents per share versus expectations or a loss of 43 cents per share of ADSK.

Either way, Autodesk continues to book losses, sales once again fell — 18.4% this time around — and the fourth-quarter outlook was miserable. The company now believes it will report revenue of between $460 million and $480 million for the quarter currently underway, falling short of the expected $488.5 million. The loss is once again going to be bigger than analysts had been expecting as well.

ADSK ended the day 3.5% lower.

Valeant Pharmaceuticals Intl Inc (VRX)

Finally, the rug got pulled out from underneath Valeant Pharmaceuticals shareholders today, who thought the struggling biopharma company might have found a palatable escape route.

Early this month, it was reported that Valeant was looking to sell its gastro drug business to Takeda, for an amount somewhere on the order of $10 billion. That cash could be used to pay off a big chunk of the company’s debt, which had exploded after the company went on an unbridled acquisition spree over the course of several years.

Now that deal may not happen after all, leaving Valeant Pharmaceuticals (and by extension, VRX shareholders) right in the trouble they’re in. According to reports from this morning, talks between Valeant and Takeda broke down with no purchase agreement being made.

VRX fell 8% on the news.

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/2016/11/why-valeant-pharmaceuticals-intl-inc-vrx-barrick-gold-corporation-usa-abx-and-autodesk-inc-adsk-are-3-of-todays-worst-stocks/.

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