In this article, we will take a look at the 10 biggest losers of this morning.
Notable stocks from the tech and communication services sectors, including Oracle Corporation (NYSE:ORCL), Meta Platforms, Inc. (NASDAQ:META) and Lumen Technologies, Inc. (NYSE:LUMN), fell this morning.
Oracle Corporation (NYSE:ORCL) shares slipped after missing profit expectations for its fiscal first quarter, while Lumen Technologies, Inc. (NYSE:LUMN) shares moved down after announcing a CEO transition. On the other hand, Meta Platforms, Inc. (NASDAQ:META) shares dropped amid a broad sell-off following an unexpected rise in consumer prices last month.
Many other stocks, including Western Digital Corporation (NASDAQ:WDC) and Peloton Interactive, Inc. (NASDAQ:PTON), were also trading lower in mid-day trading Tuesday. Check out the complete article to see what brought these companies to the list of 10 biggest losers today.
10. Rent the Runway, Inc. (NASDAQ:RENT)
Number of Hedge Fund Holders: 8
Shares of Rent the Runway, Inc. (NASDAQ:RENT) lost more than 30 percent of their value this morning after the subscription fashion service announced job cuts and issued a weak sales outlook for its fiscal third quarter.
Rent the Runway, Inc. (NASDAQ:RENT) has been struggling to maintain its subscriber base as rising inflation has forced customers to limit spending on discretionary items. The company plans to trim 24 percent of its workforce in a bid to save costs.
For the current quarter, Rent the Runway, Inc. (NASDAQ:RENT) projected revenue in the range of $72 – $74 million, behind analysts’ average estimate of $74.8 million. Several research firms lowered their price target for the fashion rental company following its third-quarter guidance.
JMP Securities trimmed its price target for Rent the Runway, Inc. (NASDAQ:RENT) from $12 to $6, while Morgan Stanley lowered its price target from $14 to $13.
9. Braze, Inc. (NASDAQ:BRZE)
Number of Hedge Fund Holders: 14
Shares of Braze, Inc. (NASDAQ:BRZE) turned red in pre-market trading Tuesday despite beating financial expectations for its fiscal second quarter. The cloud-based software company reported an adjusted loss of 16 cents per share, narrower than analysts’ average estimate for a loss of 20 cents.
In addition, Braze, Inc. (NASDAQ:BRZE) posted revenue of $86.1 million, up 54.5 percent on a year-over-year basis and above the consensus of $81.1 million. Subscription revenue came in at $81.7 million, accounting for nearly 95 percent of the total sales.
Looking forward, Braze, Inc. (NASDAQ:BRZE) expects adjusted net loss in the range of 22 – 23 cents per share and revenue between $90 – $91 million for its fiscal third quarter.
8. Unity Software Inc. (NYSE:U)
Number of Hedge Fund Holders: 23
Shares of Unity Software Inc. (NYSE:U) plummeted over 10 percent this morning. The drop came after AppLovin quit its plan to acquire Unity Software. AppLovin stock also slipped around 6 percent following the development.
Unity Software Inc. (NYSE:U) had previously refused a $17.54 billion proposal from AppLovin. Many were expecting a higher bid from AppLovin. However, the mobile technology company finally disclosed that it would not revise its offer for Unity Software Inc. (NYSE:U)
Moving forward, Unity Software Inc. (NYSE:U) is now expected to proceed with its planned acquisition of Israel-based software firm ironSource.
7. Eastman Chemical Company (NYSE:EMN)
Number of Hedge Fund Holders: 29
Shares of Eastman Chemical Company (NYSE:EMN) slid over three percent in pre-market trading Tuesday after the specialty materials company trimmed its profit outlook for the third quarter, citing weak demand.
Eastman Chemical Company (NYSE:EMN) now anticipates adjusted earnings of about $2 per share, significantly lower than analysts’ average estimate of $2.60 per share.
Discussing the outlook, CEO of Eastman Chemical Company (NYSE:EMN), Mark Costa, said in a statement:
“While demand across some end markets, including agriculture and personal care, is demonstrating resilience, demand has slowed more than expected in August and September, in particular in the consumer durables and building and construction end markets and the European and Asian regions.”
Like Eastman Chemical Company (NYSE:EMN), Oracle Corporation (NYSE:ORCL), Meta Platforms, Inc. (NASDAQ:META) and Lumen Technologies, Inc. (NYSE:LUMN) were also on the list of 10 biggest losers today.
6. Peloton Interactive, Inc. (NASDAQ:PTON)
Number of Hedge Fund Holders: 39
Shares of Peloton Interactive, Inc. (NASDAQ:PTON) fell nearly 10 percent after the opening bell today. The drop came after the struggling exercise equipment company announced the departure of its co-founders.
Peloton Interactive, Inc. (NASDAQ:PTON) said that co-founder and executive chairman of the board John Foley has resigned from his responsibilities. Moreover, his fellow co-founder and chief legal officer, Hisao Kushi, is also leaving the company next month. In addition, Peloton’s chief commercial officer Kevin Cornils will also depart later this month.
Foley remained CEO of Peloton Interactive, Inc. (NASDAQ:PTON) for nearly a decade before switching to the position of executive chairman earlier this year. The company is currently undergoing a restructuring under its new CEO Barry McCarthy to turn around its business.
5. Lumen Technologies, Inc. (NYSE:LUMN)
Number of Hedge Fund Holders: 42
Lumen Technologies, Inc. (NYSE:LUMN) named its new chief executive officer this morning. The news sent Lumen stock down more than six percent after the opening bell on Tuesday. The Louisiana-based telecommunications company has appointed Kate Johnson as its next CEO.
Johnson would replace the outgoing CEO Jeff Storey. Lumen Technologies, Inc. (NYSE:LUMN) said Storey would stay with the company through the end of this year to facilitate a smooth transition. Storey is retiring after spending nearly four decades in the telecommunication and technology sectors.
Earlier this year, Memphis-based Longleaf Partners Fund also discussed Lumen Technologies, Inc. (NYSE:LUMN) in its first-quarter 2022 investor letter, stating:
“Lumen – Lumen reported weak organic revenue growth and guided more weakness for 2022. We expect revenue growth to kick back in towards the end of 2022, and the huge FCF coupon helped offset value decline from the weaker guidance. The other factor weighing on the stock price was largest shareholder Temasek’s partial sale of its 10% position in the quarter, creating uncertainty and a share price overhang. We have a 13D filed and continue to urge the company to take steps to address the significant price-to-value gap, including continued share buybacks.”
4. Western Digital Corporation (NASDAQ:WDC)
Number of Hedge Fund Holders: 43
Shares of Western Digital Corporation (NASDAQ:WDC) hit a new 52-week low of $40.31 this morning after Exane BNP Paribas issued an “Underperform” rating for the data storage company.
Analyst Karl Ackerman referred to the declining hard-disk-drives in the coming quarters. Ackerman believes Western Digital Corporation (NASDAQ:WDC) could face a hard time amid a cyclical drop in NAND. He set a price target of $30 per share for the stock.
The coverage came a day after CEO David Goeckeler said Western Digital Corporation (NASDAQ:WDC) experienced a sharp drop in NAND storage prices over the last month. Goeckeler made these comments during the Goldman Sachs technology conference held in San Francisco yesterday.
3. Dow Inc. (NYSE:DOW)
Number of Hedge Fund Holders: 45
Dow Inc. (NYSE:DOW) is next on the list of 5 biggest losers today. The company’s shares fell over four percent this morning after Jefferies lowered its ratings for the commodity chemical company from “Buy” to “Hold.”
Jefferies analyst Laurence Alexander thinks Dow stock would likely stay range-bound for a while. Alexander also believes Dow Inc. (NYSE:DOW) could face a hard time due to a spike in interest rates that has affected consumer confidence.
Moreover, he suggested investors wait for a better price to invest in the stock. Alexander slashed his price target for Dow Inc. (NYSE:DOW) from $71 per share to $45 per share.
2. Oracle Corporation (NYSE:ORCL)
Number of Hedge Fund Holders: 69
Shares of Oracle Corporation (NYSE:ORCL) marginally moved down after the opening bell on Tuesday. The drop came after the Texas-based tech giant missed profit expectations for its fiscal first quarter.
Oracle Corporation (NYSE:ORCL) blamed the strong U.S. dollar for hurting its results. The company reported adjusted earnings of $1.03 per share, missing the consensus of $1.07 per share. Revenue for the quarter rose 18 percent on a year-over-year basis to $11.2 billion, almost in line with the consensus.
Moving forward, Oracle Corporation (NYSE:ORCL) expects a strong U.S. dollar to impact its revenue by 5 – 6 percent in the current quarter.
Moreover, Oracle Corporation (NYSE:ORCL) also made an important announcement along with its latest earnings. The company’s CTO, Larry Ellison, said in a statement:
“Today we are also announcing that Amazon Web Services customers can directly access Oracle’s MySQL HeatWave database running in the Amazon Cloud. This enables AWS users to run transaction processing, real-time analytics, and machine learning on the single unified MySQL service.”
1. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders: 184
Shares of Meta Platforms, Inc. (NASDAQ:META) slid over seven percent in mid-day trading Tuesday. There was no company-specific news behind the drop. However, industry experts were linking the decline to the recently released U.S. inflation data for the month of August.
The data showed that the consumer price index inched up 0.1 percent last month, contrary to the expectations for a 1 percent decline. The surge in the consumer price index would likely result in another interest rate hike, which is why all three major indices and most sector leaders, including Meta Platforms, Inc. (NASDAQ:META), fell this morning.
Separately, Meta Platforms, Inc. (NASDAQ:META) also appeared in the second-quarter 2022 investor letter of asset management firm Baron Funds. Here’s what the firm said:
“Shares of Meta Platforms, Inc., the owner of Facebook, the world’s largest social network, fell 28.4% during the second quarter due to quarterly results that missed consensus estimates, driven by the impact of Apple’s new privacy changes in its iOS operating system. These changes have made it harder for Facebook to measure the effectiveness of its advertising across its mobile apps.
In the longer term, we expect Facebook to continue utilizing its leadership in mobile to provide global advertisers targeted marketing capabilities at scale, with substantial monetization optionality ahead in newer areas such as Reels (Meta’s competing solution to TikTok) and e-commerce.”
You can also take a peek at Best Defensive Stocks Under $50 and 10 Best Cyclical Stocks for Inflation.
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Disclosure: None. 10 Biggest Losers Today is originally published on Insider Monkey.
