What’s the Deal With These 4 Slumping Stocks?

Targa Resources Corp (NYSE:TRGP) is off by 7.8% after reporting third quarter earnings of $0.23 per share on revenues of $1.63 billion, with the revenues down by 28.8% year-over-year. Both marks widely missed analysts’ expectations. In addition, Targa Resources announced that it will acquire the common units of Targa Resources Partners LP (NYSE:NGLS) in a $6.67 billion dollar deal in which Targa Resources will give Targa Resources Partners’ shareholders 0.62 common shares of TRGP for each share of NGLS they own. Management believes the all-equity deal, which is expected to close in the first quarter of 2016, will be immediately accretive to shareholders and will help the company achieve 15% 2016 dividend growth and greater than 10% estimated compound annual dividend growth from 2015-to-2018. Given the dividend yield of over 6%, shares certainly look appetizing, although some investors are likely holding off until WTI and natural gas prices firm up so that industry volumes have better visibility. 22 funds owned $293.1 million of Targa Resources Corp (NYSE:TRGP)’s shares at the end of the second quarter, with Leon Cooperman‘s Omega Advisors among them, owning a stake of 1.77 million shares.

Cognex Corporation (NASDAQ:CGNX) is off by almost 10% after it reported third quarter earnings of $0.29 per share on revenues of $107.58 million, beating profit estimates by $0.07 per share and meeting revenue expectations despite them falling by 36.5% year-over-year. Shares are off because guidance was weaker than expected, with management expecting fourth quarter revenue of $94 million-to-$97 million, versus expectations of $111.3 million. 22 funds in our database owned $242.46 million worth of Cognex Corporation (NASDAQ:CGNX) shares on June 30, accounting for just 5.8% of the float. Chuck Royce‘s Royce & Associates owned a stake of 2.73 million shares at the end of the second quarter. Analysts are a little bit more upbeat, with a consensus price target of $47.33, believing shares have 24.56% upside potential from present levels.

Disclosure: None