The Dow Jones Industrial Average met, and passed, a big milestone on Wednesday, pushing just a bit past the 22,000 mark. The Dow was the only major index to end the day with a respectable gain though. Bogged down by a few too many disappointing earnings reports and outlooks, the S&P 500 Index was only able to muster a gain of 0.05% to close at 2,477.57.
Leading that charge were Davita Inc (NYSE:DVA), Cardinal Health Inc (NYSE:CAH) and Pioneer Natural Resources (NYSE:PXD) … the names that dished out the aforementioned lackluster guidance. Here’s a closer look at what investors need to know.
Pioneer Natural Resources (PXD)
The good news is, oil and gas exploration company Pioneer Natural Resources topped last quarter’s earnings and revenue expectations. The bad news is, its production plans made little sense in terms of optimization, sending PXD to a loss of 10.8% on Wednesday.
For the quarter ending in June, Pioneer turned $1.63 billion worth of revenue into a profit of 21 cents per share. Analysts were only calling for a bottom line of 11 cents per share of PXD stock, and sales of $1.31 billion. Better yet, revenue more than doubled year-over-year, and the company swung from a loss to a profit.
The problem is, Pioneer Natural Resources is also paring back its plans to grow its Permian Basin oil output. All told, 30 wells originally planned to begin production this year have been pushed back to a 2018 completion.
Cardinal Health Inc (CAH)
PXD wasn’t the only stock to get trashed on Wednesday because of a grim outlook despite a healthy second-quarter report. Healthcare supply outfit Cardinal Health did well in its recently completed accounting period as well, but CAH shareholders paid the price today for less-than-thrilling guidance.
In its recently completed fourth fiscal quarter of 2017, Cardinal Health topped its earnings outlook of $1.24 per share by earning $1.31 per share of CAH stock. Sales of $33.0 billion were better than the consensus estimate of $32.8 billion. The current fiscal year isn’t apt to be quite as hot though. The company’s per-share guidance suggests per-share profits will roll in somewhere between $4.85 and $5.10 this year, falling short of the market’s expectation of $5.25.
CAH ended the session down 8.2%.
Davita Inc (DVA)
Finally, shares of dialyses company Davita plunged 8.8% on Wednesday after — you guessed it — potential future problems marred an otherwise encouraging second-quarter report.
Last quarter, Davita reported sales of $3.88 billion, and an operating profit of 92 cents per share. Analysts were only calling for a profit of 90 cents per share and revenue of $3.83 billion. Still, investors were alarmed to hear from kidney-care chief Javier Rodriguez that potential legislation in California still poses a threat. In simplest terms, the state is looking to enact a law that would require greater staffing levels at its dialysis centers, thus increasing costs.
A separate bill being considered in California could also cap the company’s profits in that key market.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.