Despite the difficulty experienced by the market involving trade wars and concerns of international economic development, it has advanced 11.62% by the end of 2019’s first quarter. Nonetheless, the fortunes of shares can be altered drastically in market volatility as witnessed in recent months.
Worst Performing Stocks
For traders looking for information on the stocks that have encountered challenges this year, the following are the five greatest losers in the S&P 500 as of now:
YTD Performance: -42%
Macy’s Inc. is an American holding company, which was founded in 1929 by Xavier Warren. Upon its creation, Macy’s held ownership of the regional department store chains Shilito’s, Filenes’, Lazarus and Abraham & Straus.
The following year, Bloomingdale joined the company. Throughout its early history, frequent divestitures and acquisitions saw the company operate several nameplates. In 2005, The May Department Stores Company was acquired, and the retirement and replacement of regional nameplates by Bloomingdale’s and Macy’s ensued nationwide in 2006. Eventually, Federated was renamed to Macy’s Inc. in 2007.
Macy’s Inc. operates the subsidiaries Bloomingdales’ Macy’s and the beauty store chain Bluemercury. It has its headquarters in Cincinnati, Ohio and all its subsidiaries have a flagship store in New York. The company operates 867 stores in Puerto Rico, Guam, and the United States as of February 2019.
Its related operations and namesake locations account for 90% of its revenue. According to Deloitte, Macy’s Inc. is the 36th largest retailer overall and the world’s largest fashion goods company based on a 2018 report; the company recorded retail sales revenue of $25 billion.
Of the five worst-performing S&P 500 stocks this year, four are mall retailers. Macy’s Inc. marks an 18.38% decline year-to-date. At 1.61% of the portfolio is CL Can Am Small Cap fund with Lee Ainslie (Trades, Portfolio), making the most substantial increase to his position.
This large increase to his position was through an addition of 215.33% to 0.26% the portfolio. With a market cap of $7.48 billion, Macy’s Inc. shares were traded around $24.33 with a price-sales ratio of 0.30 and a price-earnings ratio of 6.82. The forward dividend yield of Macy’s Inc. is 6.31%, and the trailing 12-month dividend yield is 6.20%.
Like its peers, Macy’s recorded not-so-good first-quarter numbers that include margin compression and choppy top-line trends. Investors sold the firm’s stocks in bunches against the backdrop of persons in the retail industry, recording poor early 2019 figures. Currently, the stock finds itself near five-year lows.
However, Macy’s Inc. reported remarkable sales growth in this year’s first quarter as well as positive double-digit digital sales growth. The company’s profit guides and full-year revenue were aspects maintained by the management. Consequently, Macy’s Inc. had a better quarter than its rivals.
YTD Performance: -43%
Nordstrom Inc. is an American based luxury department store that has its headquarters in Seattle, Washington. Founded in 1901 by Carl F. William and John W. Nordstrom, this luxury-chain store also operates in Canada.
It started as a shoe retailer and spread its inventory to include fragrances, cosmetics, jewelry, handbags, accessories, and clothing. Wedding and home furnishings are also stocked by select Nordstrom stores. Nordstrom has 379 stores operating in Canada, Puerto Rica and 40 American states, and clientele in 96 countries.
Nordstrom’s macro retail backdrop was not-so-great in this year’s first quarter. Comparable sales growth was negative, leading to compressed gross margins. Also, operating margins fell even more, and profits missed the mark.
Profit and the full-year revenue guides were cut. Nonetheless, most point out that the weakness of the first quarter will be secluded to the first quarter. Generally, management messed up merchandising, neglected digital marketing efforts, and ruined the rollout of the new loyalty program in the first quarter saw inventory decrease more than 5%.
Broadly, Nordstrom is well-positioned to record better number moving forward. These numbers will join on a discounted valuation (9.7-times forward earnings) to yield out-performance in Nordstrom’s stock from the current depressed levels.
However, Nordstrom stock now trades for nine times the average analyst earnings-per-share for fiscal 2019. It could surge in the next few years, driven by an aggressive share buyback plan, cost-cutting initiatives, and growth investments.
YTD Performance: -43%
Nektar Therapeutics is a biopharmaceutical corporation based in the United States. The firm seeks to discover and develop innovative medicines in terrains that have high and unmet healthcare needs.
Mid last month, the company’s shares were trapped in a classic wedge chart trend, which was pointing to a significant 45% oscillation in the stock. This swing is not a major shocker as NKTR is used to witnessing sharp fluctuations on drug announcements as well as other developments.
Early this month, the NKTR’s shares crashed 39% after the company revealed an issue related to quality and control with regards to a significant cancer treatment. Wall Street analysts downgraded the firm and reduced their targets in the concerns of the impending success of the cancer therapy.
According to the Business Insider report, the company was down nearly 44% YTD at the beginning of August.
In the second quarter, the corporation noted a shortfall of $109.9 million, which can also be equated to 63 cents per share, in comparison to $971.5 million net income, or $5.33 per share, during the last year.
DXC Technology Company
YTD Performance: -37%
DXC Technology is a global IT services firm that spearheads digital transformations for customers. It is also an acknowledged leader in corporate responsibility. As international companies are engaging in paradigm shifts to digital technology, DXC is making remarkable efforts in this move with an aim to achieve better outcomes in business.
Last week, DXC’s shares were at $33.92 per shares as compared to a previous closing price of $35.91.With a -5.54% loss, it is essential for investors to have insights into the technical trends of the stock movements revealed in stock charts. In view of that, DXC exhibited a decrease of -36.20% in relation to its YTD performance. It had highs and lows between $34.61 and $96.75 within one year in contrast to the -43.67 simple moving average within the preceding 200 days.
At the beginning of this month, DXC went backward as opposed to its average movements documented in July. Moreover, DXC stock’s price volatility during the last months was 2.23%; in the course of the last one year, DXC declined by -6.62%.
After DXC reduced its full-year guidance, the firm’s stock plummeted, and the cost-cutting pace did not match up the rate of revenue decline. Integration, transaction and restructuring, and separation-related costs damage earnings and may persist for the remaining part of the year. Investors, who set aside a third of the corporation’s market cap after the earnings report, became impatient.
With the momentum of growth behind the firm and the forthcoming near-term integration headwinds, retaining DXC stock is quite risky than before.
Kraft Heinz CO
YTD Performance: -38%
Kraft Heinz is a universally trusted producer of luscious foods and offers high quality, nutrition, and excellent taste for eating occasions – in restaurants, on the go, or at home. It has more than eight $1 billion brands.
By the end of March this year, KHC’s shares had dropped 22.63% YTD. During that trade season, it was recorded that the firm has a $39.8 million market cap, and its shares were transacted approximately $32.64 along with a 1.49 price-sales ratio.
CNBC reported that Kraft Heinz pulled back on the sales of its assets such as Breakstone’s sour cream and cottage cheese and Maxwell House coffee business, in order to facilitate the payment of a down debt. The company aims to reorganize its trade on brands, including Heinz ketchup, a household name across the globe.
In February, the corporation reduced its dividend by 36% and also revealed an inquiry by the Securities and Exchange Commission with reference to its procurement and accounting practices.
At the close of August 16 this year, analysts indicated that KHC’s 52-Week Change was at -58.67% and-0.33% with regard to S&P500 52-Week Change.
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