Friday was another relatively quiet day for the stock market, with major benchmarks finishing the week at or near record levels. Favorable readings on the U.S. economy helped buoy investor sentiment, and positive earnings results from several corners of the market reinforced the idea that stocks can generally hold onto their huge advances since mid-December. Yet some companies had bad news that caused them to lose ground. Tesla (NASDAQ: TSLA), Briggs & Stratton (NYSE: BGG), and Target (NYSE: TGT) were among the worst performers. Here's why they did so poorly.
Tesla keeps slowing down
Shares of Tesla dropped another 5%, adding to losses from earlier in the week as investors digested the shift in sentiment among analysts following the stock. One particularly bullish analyst changed gears abruptly yesterday, with Wedbush cutting its rating from outperform to neutral on an assessment that CEO Elon Musk's outlook is overly aggressive without taking necessary steps to cut costs. Today, investors seemed nervous that the share-price decline itself could prompt problems, as it's increasingly apparent that Tesla will have to raise capital at some point. If it resorts to selling stock at depressed levels, Tesla could face even greater losses ahead.
Image source: Tesla.
Briggs & Stratton gets clipped
Briggs & Stratton saw its stock fall 14% after the lawn, garden, and power equipment specialist reported its fiscal third-quarter financial results. Sales were down 4% from the year-ago period, with the company blaming bad weather, as well as the impact of the Sears bankruptcy on revenue. Moreover, Briggs cut its earnings guidance for the full fiscal year by more than half, citing efforts to launch new initiatives to optimize its business and ongoing weak demand. CEO Todd Teske is hopeful that Briggs & Stratton is in a good position to mount a recovery from current levels, but until Mother Nature cooperates, it could remain tough going for the company.
Target deals with a new Amazon threat
Finally, shares of Target lost nearly 6%. The department store retailer's stock reacted negatively to news from e-commerce giant Amazon.com (NASDAQ: AMZN) that it would begin to offer one-day shipping to customers as part of Amazon Prime. The move raised questions about whether Target and its peers will try to match Amazon, despite having already made substantial investments toward trying to keep up with the e-commerce company in the past. The good news for Target is that Amazon admitted that it could take it some time to work up to achieving its one-day goal, giving the department store leader a chance to consider its future strategy more fully.
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon and Tesla. The Motley Fool has a disclosure policy.