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Why NIO, Brown-Forman, and Sarepta Therapeutics Slumped Today

Dan Caplinger, The Motley Fool

Wednesday was a bad day on Wall Street, as most major indexes finished lower. Small-cap stocks were hit harder than their large-cap counterparts, due in part to readings on the U.S. economy that signaled the possibility of a slowdown in the future. Moreover, downward pressure from some high-profile players weighed on overall market sentiment. NIO (NYSE: NIO), Brown-Forman (NYSE: BF-A) (NYSE: BF-B), and Sarepta Therapeutics (NASDAQ: SRPT) were among the worst performers. Here's why they did so poorly.

NIO investors hit the brakes

Shares of NIO fell 21% after the Chinese manufacturer of electric vehicles reported its fourth-quarter financial results. The company said that production of its ES8 sport utility vehicle almost doubled compared to the third quarter of 2018, with deliveries soaring nearly 150%. However, losses were much wider than expected, and NIO said that it will put off plans to open a factory in 2020 in favor of keeping its current production agreement intact. Moreover, 2019 sales are off to a slow start due to reductions in subsidies, and even CEO Louis Hsieh was uncharacteristically pessimistic about NIO's near-term prospects -- at least until the company starts producing its more affordable ES6 SUV later this year.

Blue sportscar with vertically opening doors.

Image source: NIO.

Brown-Forman takes a shot

Brown-Forman's Class B stock declined 5% following the release of its fiscal third-quarter financial report. The maker of Jack Daniel's and other premium spirits said that sales rose 3% during the quarter, helping to push diluted earnings per share up by 20%. However, worries about tariffs and competition plagued shareholders prior to the report, and CEO Lawson Whiting said that it required "cost discipline [to help] offset some of the large burden we are absorbing due to the retaliatory tariffs on American whiskey." Until trade tensions get resolved, Brown-Forman shares could remain under pressure.

Sarepta sells some stock

Finally, shares of Sarepta Therapeutics dropped 11%. The rare-disease genetic medicine specialist sold 2.6 million shares of stock late Tuesday, raising about $375 million. Pricing was at $144 per share, which was below the roughly $149 share price for Sarepta as of Tuesday's close. Sarepta expects to use the money to help finance its clinical trials and commercialization efforts, along with any other corporate purposes that may arise. It's not unusual for drug and biotech companies to use share-price spikes as an opportunity to sell stock, and after favorable quarterly results in late February, Sarepta still looks promising.

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Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.