The bulls made a respectable effort, but even with the gain of 0.22% and close at 2144.29, the S&P 500 is still on the underside of a major line in the sand. Concerns about the timing of the next Federal Reserve rate hike continue to get in the way.
Here’s a closer look at what went wrong for each.
Intel Corporation (INTC)
When all was said and done, Intel didn’t do terribly last quarter. In fact, it did rather well. Revenue as well as income was up on a year-over-year basis, and the Q3 figures the company reported were ahead of analyst expectations. Unfortunately, the Q4 outlook was sub-par, spooking INTC shareholders.
In its recently completed quarter, Intel earned an operating profit of 80 cents per share on 15.78 billion in revenue. That was up from Q3-2015’s bottom line of 64 cents per share of INTC and a top line if $14.5 billion. The pros were only calling for revenue of $15.56 billion and earnings of 72 cents per share. Personal computing was a surprising bright spot.
It’s not bright enough, however. For the quarter currently underway, Intel offered revenue guidance of $15.7 billion, versus analyst expectations of $15.85 billion.
INTC ended the day down 5.9%, with shareholders still unsure if the company is truly on the road to recovery.
Abbott Laboratories (ABT)
Not that there was ever a great deal of doubt about the matter, but drugmaker Abbott Laboratories is forging ahead with the acquisition of medical device maker St. Jude Medical, Inc. (NYSE:STJ) … and ABT shareholders are none too happy about it, if today’s 2.8% setback is any indication.
The concern is understandable. St. Jude Medical was targeted by a Muddy Waters report published in late August — just before Abbott was about to consummate the deal — that claimed the company’s Merlin@home remote monitoring devices were not secure and subject to hacking. Abbott had some time to think it over, and isn’t concerned. Shareholders are.
Fanning the bearish flames that burned ABT shareholders on Wednesday was Abbott’s narrow-but-not-raised earnings guidance for the full year. The company now expects to report earnings of between $2.19 and $2.21 for 2016, versus an average analyst estimate for income of $2.20 per share.
Rite Aid Corporation (RAD)
Finally, just when it looked like the acquisition of Walgreens Boots Alliance Inc (NASDAQ:WBA) was moving along swimmingly for Rite Aid, the proposed pairing gets thrown a curveball. And, it was Kroger Co (NYSE:KR) that caught RAD owners off guard.
One of the preemptive measures Rite Aid took to steer clear of any antitrust concerns was planning the sale of roughly 500 stores that would otherwise crimp competition. The challenge was simply finding a buyer for those few hundred stores, but grocery name Kroger was reportedly eager to fill that void and garner some new exposure in the process.
Now, not so much. As it turns out, Kroger is reportedly not looking to enter the space that would be freed up by the Rite Aid/Walgreens union. Unsure if the merger is going to happen at all now, RAD shareholders sent the stock down 5.0%.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.