The day after a major rate-hike decision certainly wasn’t as bullish as the day of the decision. With a night to sleep on it, investors took some profits on Thursday, dragging the S&P 500 0.16% lower to a close of 2,381.38.
That was only a drop in the bucket compared to the losses booked by Guess?, Inc. (NYSE:GES), Snap Inc (NYSE:SNAP) and Biogen Inc (NASDAQ:BIIB) today. Here’s a closer look at what went wrong for each name.
Biogen Inc (BIIB)
The potential upsides of biopharma outfit Biogen are slowly deteriorating, and analysts are taking notice. BIIB was downgraded not by one but by two research houses today, sending the stock markedly lower.
Geoffrey Porges was responsible for one of the downgrades on Thursday, lowering its stance on BIIB from “Outperform” to “Market Perform.” Analyst Geoffrey Porges explained:
“Our downgrade is based on a slower than expected ramp for Spinraza, and the completion of the series of important catalysts that have evolved over the last few months.”
Morgan Stanley analyst Matthew Harrison voiced a similar concern regarding Biogen, leading to the same bearish response.
He lowered the firm’s opinion on the stock from “Overweight” to “Equal Weight,” commenting:
“As many investors are already aware, Spinraza is a key potential upside driver for Biogen while launch of Roche’s competing MS product Ocrevus could present downside.”
BIIB ended the session 4.7% lower.
Snap Inc (SNAP)
For the fourth time in the last two weeks, newly minted shares of the parent company of online-messaging platform Snapchat were featured on the daily ‘Worst 3’ list. Today, SNAP logged a loss of 4.2%. The prod for the pullback on Thursday was the same as the prior ones — Snap shares don’t even come close to justifying their value — but the crowd pointing out the company’s flaws was a new one.
Moffett-Nathanson was today’s ringleader, with analyst Michael Nathanson opening up his coverage of the company with a “Sell” rating and a target price of $15.00. Nathanson wrote:
“Snap must dig itself out of a much bigger GAAP Ebit margin hole than Facebook, out of the gate, while it wraps up 2016 essentially on part with Twitter’s 2011 Ebit margin profile. [At that rate, Snap] won’t reach positive GAAP operating margins until 2021.”
Venture capital firm Social Capital’s founder and CEO Chamath Palihapitiya chimed in that the company may be thinking too narrowly.
Today was the first day SNAP shares fell below a price of $20 since their Mar. 2 IPO.
Guess?, Inc. (GES)
Finally, serving as another round of evidence that the retail industry is in trouble, apparel brand Guess posted fiscal fourth-quarter results that fell short of revenue as well as earnings estimates.
For the quarter ending in January, Guess earned 41 cents per share on sales of $679.3 million. Analysts had been modeling a bottom line of 45 cents per share of GES and a top line of $689 million.
The crux of the 11.4% setback GES suffered on Thursday, however, stemmed from the company’s guidance. Guess is looking for a fiscal 2018 profit of between 28 cents and 40 cents per share, versus analyst expectations of 64 cents per share.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
