Thursday was a down day on Wall Street, but declines in major market benchmarks were relatively modest. The Dow Jones Industrial Average finished off about 69 points, while other indexes made similar percentage moves lower. Market participants didn't have a particularly strong response to general news, preferring instead to concentrate on impacts to specific companies and their shares. HP (NYSE: HPQ), Booking Holdings (NASDAQ: BKNG), and Novavax (NASDAQ: NVAX) were among the worst performers. Here's why they did so poorly.
HP slides on sluggish sales
Shares of HP dropped 17% after the hardware company reported its fiscal first-quarter financial results. The tech giant said that revenue was higher by just 1% compared to the year-earlier period, and it took a substantial decline in outstanding share count to produce an 8% rise in earnings per share. HP's personal systems unit got some support from the commercial sector, and printing saw some bright spots in sales of printer hardware. Yet HP's outlook was tepid at best, and the fact that customers are turning to e-commerce sources for consumables like printer ink is likely to have a permanent negative impact on the printer giant's long-term business prospects.
Image source: HP.
Booking's guidance disappoints
Booking Holdings suffered an 11% fall in its share price following its release of its fourth-quarter financial report. The online travel specialist posted impressive results for the period, including revenue growth of 15% and bottom-line gains of 25% compared to year-earlier levels. Yet what sent some investors into a panic was Booking's guidance for the first quarter of 2019, which included flat expectations for revenue and gross travel bookings. The travel company has a history of providing guidance that proved lower than eventual results, but shareholders aren't willing to bet on that continuing to be the case today.
Novavax misses the mark
Finally, shares of Novavax plunged 67%. The vaccine maker announced poor results from the phase 3 clinical trial of its ResVax vaccine for respiratory syncytial virus, saying that the vaccine failed to meet the primary objective of preventing medically significant lower respiratory tract infection as a result of the disease. Novavax CEO Stanley Erck tried to salvage what he could from the trial, noting that "while this study did not meet the pre-specified success criterion for the primary clinical endpoint of this trial, the data indicate that ResVax protects infants from some of the most serious consequences of RSV," including respiratory tract infection hospitalizations and cases involving sever hypoxemia. Nevertheless, shareholders think that this could make ResVax a non-starter for future sales, and they've reassessed the stock's valuation as a consequence.
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