Trading resumed on Wednesday with only a modestly bullish flavor, as worse-than-expected factory orders for June planted some seeds of doubt as to how firm the market’s footing was. By the time the closing bell rang, the S&P 500 was up a modest 0.15%, ending the session at 2,432.54.
Not every name followed that bullish lead though. In fact, Continental Resources, Inc. (NYSE:CLR), Tesla Inc (NASDAQ:TSLA) and O’Reilly Automotive Inc (NASDAQ:ORLY) were all pointed in the other direction in a big way.
Here’s the deal.
O’Reilly Automotive Inc (ORLY)
Not only was June less than thrilling in terms of sales of new cars, it was a tough month for the retailers that keep used cars running. Shares of auto parts retailer O’Reilly Automotive fell a whopping 18.9% on Wednesday when the company reported to ORLY shareholders a disappointing sales report for the recently completed quarter.
For its second fiscal quarter of 2017, O’Reilly saw same-store sales growth of 1.7%, falling short of the company’s previous growth guidance of between 3% and 5% for the quarter in question. It wasn’t the official second-quarter report from O’Reilly … just the sales outlook. A statement from the company did acknowledge that the tepid growth would have an adverse impact on the company’s Q2 filing.
Tesla Inc (TSLA)
Shares of electric carmaker took a pretty big hit last week as well as on Monday of this week, but the sellers weren’t done yet. They tore into TSLA again today following a grim outlook from Goldman Sachs in response to Monday’s Q2 report that indicated deliveries were far less than expected for the three-month stretch.
All told, Tesla delivered roughly 22,000 cars last quarter, down from the first quarter’s tally of 25,000, and falling short of the forecasted 23,655 units.
Goldman Sachs analyst David Tamberrino has a problem with the trajectory of the math, lowering its full-year delivery forecast for the company and simultaneously lowering his price target on TSLA from $190 to $180. Tamberrino explained:
“We believe the excess production above deliveries, the discontinued ‘order rate’ metrics, and the company’s 2H17 guidance (Model S and Model X deliveries to likely exceed) in combination with the past four quarters of delivery results point to a plateauing of demand for its current products.”
Today’s 7.2% setback from TSLA brings the seven-day rout to more than 14%.
Continental Resources, Inc. (CLR)
Last but not least, another rough day for crude oil prices took another big bite out of oil stocks. Devon Energy Corp (NYSE:DVN) fell 5.1%, and Hess Corp. (NYSE:HES) was off by 4.5%. Continental Resources dished out the most pain though — in terms of total volume — sliding 4.5%.
Crude’s 4.3% selloff brought a decisive end to a two-week rally. Hints of evidence that OPEC wasn’t overly committed to its curtailing plans spooked investors, though the U.S. dollar’s recent rebound effort is starting to sink in as well. Both ultimately work against oil prices, which had rallied of late more on speculation than actual fundamentals.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.