It’s been a hectic day on the stock market, with dozens of earnings reports and other material news events sending a multitude of stocks careening wildly in different directions. Among the stocks shooting in the wrong direction today are Molina Healthcare Inc. (NYSE:MOH), Golar LNG Limited (USA) (NASDAQ:GLNG), Groupon Inc (NASDAQ:GRPN), Western Digital Corp (NASDAQ:WDC), and Seagate Technology PLC (NASDAQ:STX). Let’s find out why investors are getting out of these stocks today and see how top hedge funds tracked by Insider Monkey have been trading these equities of late.
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Molina Sinks on Big Earnings Miss, Analyst Downgrade
Shares of Molina Healthcare Inc. (NYSE:MOH) are off by 19% this afternoon, dragging several other healthcare service providers down with it after the company widely missed earnings estimates, despite a 37% year-over-year jump in revenue to $4.3 billion. Earnings per share fell by 23% year-over-year to $0.43, being partly impacted by a greater than 100-basis-point increase in customer healthcare costs in relation to premium revenue, a figure which jumped to 89.8%. The results prompted Bank of America Merrill Lynch to downgrade Molina Healthcare to ‘Underperform’ from ‘Neutral’ today, further weighing on the stock’s performance. The results will be disappointing for David Keidan‘s Buckingham Capital Management, which added an 80,700-share position in Molina Healthcare Inc. (NYSE:MOH) to its portfolio during the first quarter.
Fortuna Withdrawal, Analyst Downgrade Sinking Golar
An analyst downgrade and Schlumberger Limited. (NYSE:SLB)‘s withdrawal from a planned 40% stake in Ophir Energy Plc (LON:OPHR)‘s Fortuna LNG project are sinking shares of both Ophir Energy and Golar LNG Limited (USA) (NASDAQ:GLNG) today, with the latter down by 23.66%. Golar’s stock has taken a hit from the development due to its recent agreement with Schlumberger to provide LNG facilities and services to such projects. The scuttled deal also led to DNB Markets downgrading shares of Golar to ‘Hold’ from ‘Buy’ in a note to investors this morning. 29 hedge funds in our database were long Golar LNG Limited (USA) (NASDAQ:GLNG) at the end of December, down from 39 at the end of September.
Groupon is among three more of the big decliners in today’s session which we’ll analyze on the next page.
Weak Results Trip Up Western Digital
Shares of Western Digital Corp (NASDAQ:WDC) are down by 13.38% today after the data storage device manufacturer released a disappointing earnings report for the company’s third quarter of fiscal year 2016. Revenue slumped by 20.5% year-over-year to $2.82 billion, missing the consensus estimate by $40 million, while non-GAAP EPS came in $0.07 below expectations at $1.21, which was down by 32.3% from the third quarter of fiscal year 2015. WDC’s guidance for the fiscal fourth quarter was also underwhelming, with the company predicting revenue of between $2.6 billion and $2.7 billion, while analysts had been much more optimistic, predicting a figure of $2.92 billion. Eric Sprott‘s Sprott Asset Management cut its Western Digital Corp (NASDAQ:WDC) stake by 16% during the first quarter, to 120,000 shares.
WDC Rival Seagate Also Battered by Weak Results
Seagate Technology PLC (NASDAQ:STX) is suffering the same fate as competitor Western Digital today, and for the same reason. Seagate shares are down to the tune of 19% after the company reported the same waning demand for its hard drive products that Western Digital did. Seagate’s revenue for the third quarter of fiscal year 2016 dropped by 22% year-over-year to $2.60 billion, while the $0.88 per share that it earned in the third quarter of fiscal year 2015 is but a distant memory, after the company lost $0.07 per share in the latest quarter. The news wasn’t unexpected, as the technology company warned in mid-April that its results would miss expectations. 25 funds in our system owned $374.41 million worth of Seagate Technology PLC (NASDAQ:STX)’s shares on December 31, which accounted for 3.40% of the company’s float.
Groupon Tumbles on Growing Losses, Weak Guidance
Lastly we come to Groupon Inc (NASDAQ:GRPN), which has shed over 16% of its market value today after the group deals website reported its first quarter results and issued weak guidance for the full 2016 year. The company lost $0.08 per share on a GAAP basis in the first quarter, nearly four-times the losses that it incurred in the same quarter a year ago, partly due to a marketing push by the company which was announced last year. That push did result in nearly a million new customers being introduced to the service, which the company expects to start bearing fruit by 2017. That did nothing to help the company’s guidance for the full 2016 year however, which was disappointing, with analysts’ revenue estimates of $3.01 billion coming in near the top of Groupon’s guidance range of $2.75 billion to $3.05 billion for the year. Alexander Tamas‘ VY Capital sold off its position in Groupon Inc (NASDAQ:GRPN) during the first quarter, which had previously amounted to 2.56 million shares.