At a time when the broader S&P 500 is flat, shares of Progressive Waste Solutions Ltd (USA) (NYSE:BIN), Harley-Davidson Inc (NYSE:HOG), Horizon Pharma PLC (NASDAQ:HZNP), and WhiteWave Foods Co (NYSE:WWAV) are falling in morning trading on negative catalysts. Let’s take a closer look at those catalysts as well as the smart money’s sentiment on these declining stocks.
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Progressive Waste Solutions Ltd (USA) (NYSE:BIN) is off by more than 16% this morning after the company announced disappointing preliminary financial results for the third quarter. For the period, Progressive Waste Solutions Ltd (USA) (NYSE:BIN) expects to report $489 million in revenues and $127 million in adjusted consolidated EBITDA, versus analyst expectations of $495.39 million in revenues and slightly higher EBITDA. In addition to lower-than-expected third quarter EBITDA, management also expects to deliver lower-than-expected yearly EBITDA of $480 million-to-$485 million in 2015, down from the previous guidance of $500 million-to-$515 million. The company missed expectations mainly because of the stronger dollar and higher operating costs. The low commodity prices may have also had something to do with it. From the press release:
The updated outlook also reflects the actions we are taking in our West region as well as a more cautious view of waste volumes in parts of our western Canada operations in the fourth quarter, which has traditionally been a strong period for special waste disposal projects in particular, and which may be affected by the energy-related economic slowdown.
If management controls costs and energy prices recover, Progressive Waste Solutions Ltd (USA) will do well.
Harley-Davidson Inc (NYSE:HOG) is down by 11.7% after its third quarter results missed earnings estimates by $0.09 per share and revenue expectations by $70 million. Motorcycle unit sales fell by 1.4% year-over-year to 72,178 while operating margins for motorcycles fell by 0.4 percentage points to 12.5%. Guidance was soft as well, as the company expects to ship 265,000-to-270,000 motorcycles in 2015, down from previous guidance of 276,000-to-281,000. Full year operating margins are now expected to be 16%-to-17% versus past guidance of 18%-to-19%. Harley-Davidson is a great brand, but it needs to find traction among the younger set to have a bright future. Of the 730 elite funds we track, 27 funds owned $831.79 million of the company’s shares (accounting for 7.10% of the float) on June 30, versus 27 funds and $1.15 billion respectively on March 31. William Von Mueffling‘s Cantillon Capital Management owns 6.08 million shares.
On the next page, we examine why Horizon Pharma PLC and WhiteWave Foods Co are also falling sharply this morning.