Completely reversing Friday’s meltdown, the bulls hit the ground running with a pushback effort on Monday. By the time the closing bell rang, the S&P 500 was at 2159.04, up 1.47%. Yet, even with the big move, the index remains below some key technical levels.
Not every stock jumped on board Monday’s bullish bandwagon. VimpelCom Ltd (ADR) (NASDAQ:VIP), Geron Corporation (NASDAQ:GERN) and Polaris Industries Inc. (NYSE:PII) each dipped pretty deep into the red ink.
Here’s the deal.
Polaris Industries Inc. (PII)
Between a bit of a public relations gaffe and the same general waning in demand for high-end “toys” that forced Harley-Davidson Inc (NYSE:HOG) to lay off a couple hundred workers, it wasn’t entirely surprising that ATV and motorcycle maker Polaris Industries dialed back its full-year profit guidance, spurring a downgrade in the process.
As of the latest look, Polaris Industries expects to report a profit of between $3.30 and $3.80 per share of PII, which is about $2.60 less than the company’s prior guidance. At least part of the weakened demand may have stemmed from reports that some of its RZR trail vehicles had caught fire, forcing a recall.
KeyBanc lowered its opinion on PII to “Sector weight,” commenting “[the extent of the repair on the RZR Turbo is] much more complex than originally anticipated and has consequently delayed the timing of RZR shipments and resulted in increased promotional/brand wellness spend as well as a higher warranty accrual.”
PII ended the day down 5%.
Geron Corporation (GERN)
Biopharmaceutical developer Geron saw its stock plunge a hefty 20% on Monday following a concerning update on the clinical trials of one of its highly watched drug trials.
Actually, the superficial news wasn’t horrible. Johnson & Johnson (NYSE:JNJ) subsidiary and Geron partner Janssen decided not to move forward with a low-dose trial of Geron’s imetelstat as a therapy for a blood cancer called myelofibrosis. Presumably, Janssen didn’t see enough efficacy for the low-dose arm of the trial.
Janssen is going to continue the higher-dose study, though in light of the low-dose trial’s early cancellation, the market isn’t optimistic about the other test. See, two years ago imetelstat was implicated liver function problems. Although the FDA opted to remove the hold on further enrollments, the safety concerns casted a lingering shadow of doubt.
VimpelCom Ltd (ADR) (VIP)
Last but not least, VimpelCom shares lost 7% of their value today after the company announced an offering of 142.5 million shares of its American depository receipts. All told, the public offering represents roughly $556 million worth of shares, versus a market cap of $6.4 billion.
The salt in the wound is the fact that VimpelCom won’t even garner one penny from the sale. The VIP shares in question are owned by Norwegian outfit Telenor ASA (ADR) (OTCMKTS:TELNY), which is trying to pare back some of its 33% stake in VIP. The 142.5 million shares in question make up about 8% of the Russian telecom company’s float.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.