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The 10 S&P Stocks That Dropped Have 40% or More This Year
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It has been a wild ride for stocks the past several months. However, when all is said and done, the S&P 500 is up 1.4% in 2018 through the end of October to 2,711. Some famous stocks, like Facecbook, have fallen into the correction category. It is down 14% to $153. The worst performing S&P stocks are off much more than that. The following 10 are off more than 40% this year.
1. The first among these is savaged General Electric Co. (NYSE: GE). It has changed chief executives. Larry Culp took the job a month ago from GE veteran John Flannery. The 125-year-old company, which was once the greatest conglomerate in the world, is auditioning divisions and cutting costs, and it recently slashed its precious dividend to a penny to save money. Culp has suggested layoffs, and the sell-offs are not over until GE is down to two or three core divisions. Its stock is off 42% this year to below $10.
2. The stock price of gambling company Wynn Resort Ltd. (NYSE: WYNN) was down 42% to $100 as of month’s end. It has been plagued by sexual harassment claims against its departed CEO and founder, Steve Wynn. There are semi-regular battles between his ex-wife, who has considerable holdings, and the balance of the board, some of whom have been ousted. In its most recent quarter, it missed estimates on both the top and bottom lines.
2. Shares of EQT Corp. (NYSE: EQT) are down 42% to less than $35. The prospects of the energy company have been hurt by lower oil and gas prices. It has tried to mitigate this via sales of some of its natural gas assets to Peoples Natural Gas. EQT has not only down so much this year, but the stock dropped to an eight-year low on October 18 after America’s largest natural gas company earnings missed expectations. The company recently appointed new directors and may break itself in half.
4. Affiliated Managers Group Inc. (NYSE: AMG) shares are down 44% so far this year to under $115. The company is an asset manager and mutual fund company. It serves both individual and institutional investors and has $824 billion assets under management. While the company beat earnings estimates in the most recent quarter, costs rose more than expected. Investors worry choppy markets could hurt its numbers this quarter, particularly in funds that hold big cap tech shares. It is also in a highly competitive market against giants like Fidelity and Vanguard.
5. L Brands Inc. (NYSE: LB) shares are down 46% so far this year to $32 or so. It is the parent of two major retailers, Victoria’s Secret and Bath & Body Works. To turn itself around, it may dump luxury lingerie brand La Senza. It also will close its 26 Henri Bendel stores. Victoria’s Secret is a much larger problem. Its same-store sales were up only 1% in September. Its Pink brand, an inexpensive part of the Victory’s Secret product line, has done very poorly. The bright part of the brand lineup is Bath & Body Works. Its same-store sales were up 10% in the second quarter. However, net income for that quarter dropped from $139 million to $99 million.
6. Dentsply Sirona Inc.’s (NASDAQ: XRAY) stock is down 47% from January through October to $35. The company makes dental supplies in several categories, including implants, imaging systems and treatment centers. Including its predecessor company, it is over 100 years old. The primary cause for the battering is the outlook the company posted when it issued second-quarter earnings. While revenue for the period rose 5% to $1.04 billion, the net loss the company posted was $1.12 billion. The final problem Dentsply Sirona faces is that Moody’s cut its outlook on the company’s Baa2 senior unsecured rating and Prime-2 commercial paper rating to negative.
8. The shares of Newell Brands Inc. (NYSE: NWL) are down 48% so far this year to around $16. It is in a very broad range of brands from home appliances to cleaning products to pens to products used for outdoor activities like camping. Total brands owned are over 150. Founded in 1903, Newell owns the Crock-Pot, Sunbeam, Rubbermaid and Coleman brands, along with dozens of others. Newell employs over 40,000 people. One of Wall Street’s problems is that Newell has too many brands to manage. It may sell several brands that are a drag on earnings. In the most recent quarter, Newell’s revenue dropped to $2.2 billion from $2.5 billion in the year-ago period. Some of this was due to revenue lost from businesses it sold. The company lost $76 million, compared to $17 million in net profits last year
9. Mohawk Industries Inc. (NYSE: MHK) shares are down 55% this year to $125 or so. The company makes flooring, and a slowing in the real estate market has battered it. It is also one the few American companies that have cited higher interest rates as a problem, along with inflation that has driven up the price of materials it uses in many of its products. When it announced earnings last week, the stock dropped 20% as Mohawk missed on both the top and bottom lines. Revenue was $2.54 billion for the period, compared to $2.45 million. Net income was $227 million, down from $270 million. CEO Jeffrey S. Lorberbaum gave comments no investor wants to hear:
Our third quarter results fell short of our expectations. Sales growth in all segments was lower than our estimates, price increases had less impact and we experienced more inflation than predicted. Transportation costs continued to rise due to the limited availability of common carriers and higher fuel prices.
10. Delphi Technologies PLC (NYSE: DLPH) shares fell 60% year to date to less than $22, more than any other S&P 500 component. The company is based in London but trades on the New York Stock Exchange. It makes powertrain technologies and aftermarket products for cars and trucks, including fuel injection systems, valvetrains, fuel delivery modules and ignition coils. Recently, CEO Liam Butterworth left, about 10 months after taking over the top position. Delphi also sliced its earnings forecast for the year. If Delphi’s forecast had not been so poor, its current earnings might have stabilized shares. Revenue for the last reported quarter was $1.23 billion, up from $1.19 billion a year ago. Net income was $86 million, up from $48 million.
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