Wall Street’s main indices finished the shortened trading week in the negative territory, dampened by labor market data that came in much hotter than expected. The news fueled concerns that the Federal Reserve will not slash interest rates again.
Both the Dow Jones and the Nasdaq Composite dived by 1.63 percent on Friday, while the S&P 500 declined by 1.54 percent.
Ten companies mirrored a wider market downturn amid a series of catalysts that dampened investing appetite. This article explores the reasons behind their decline.
In Friday’s biggest losers, we only considered the stocks with at least $2 billion in market capitalization and $5 million in daily trading volume.
A stock market graph. Photo by energepic.com
10. Oscar Health Inc. (NYSE:OSCR)
Health insurance firm Oscar Health (OSCR) finished this week’s shortened trading lower, slashing 7.26 percent to end at $14.18 apiece, weighed by the Los Angeles wildfire that destroyed thousands of structures and claimed the lives of 10 people.
Oscar Health (OSCR), along with its insurance counterparts, all posted significant declines as the Los Angeles blaze which broke out on Tuesday already resulted in total damage and economic loss of up to $150 billion.
According to weather site AccuWeather, the economic damages could still potentially increase as the fires continue to spread.
Insurance companies stand to bear the brunt of the damages and expect increased claims that could potentially hurt their financial performance.
9. ON Semiconductor Corp. (NASDAQ:ON)
ON Semiconductor Corp. (ON) nearly touched a new 52-week low on Friday, posting a 7.49-percent decline to end the day at $53.94 each after an analyst at Truist downgraded its targets for the company.
In its latest report, Truist downgraded ON Semiconductor to a “hold” rating with a new price target of $60, lower by 29 percent than the $85 projected earlier. The analyst cited deteriorating demand trends and management’s focus on exiting certain business lines this year.
Separately, Bank of America also reduced its price target for ON Semiconductor (ON) to $75 from $90 per share but maintained a “buy” rating for the company. The adjustment followed a less optimistic outlook from the firm during the 2025 Consumer Electronics Show in Las Vegas.
Specifically, concerns about recovery prospects in both the near term and the calendar year 2025 have led to a subsequent decrease in the estimated pro-forma EPS for the next few years.
8. Celsius Holdings Inc. (NASDAQ:CELH)
Energy drinks and supplements maker Celsius Holdings (CELH) saw its share prices drop by 7.76 percent to end the day at $26.76 each following a lawsuit that claimed the company made false or misleading statements and failed to disclose crucial information.
Specifically, the lawsuit alleged that Celsius materially oversold inventory to PepsiCo, Inc., significantly exceeding demand which set the stage for a future sales decline as Pepsi was expected to sharply reduce its purchases.
As Pepsi worked through the inventory overstock, Celsius’ sales were projected to drop substantially, negatively affecting the company’s financial performance and outlook. The lawsuit further claimed that Celsius’ sales rate to Pepsi was unsustainable and gave a misleading impression of the company’s overall financial health and future prospects.
7. ZIM Integrated Shipping Services Ltd. (NYSE:ZIM)
Shares of ZIM Integrated (ZIM) dropped for a second day on Friday, losing 7.87 percent to end at $19.09 apiece as investor sentiment was dampened by the growing trade tensions globally.
With the trade war, shipping companies such as ZIM stand to bear the brunt of higher operating costs, lower global trade volumes, and shipping rates, should country leaders impose higher trade tariffs.
Earlier, Trump already signaled to levy 10 to 20 percent taxes on all imports from all countries with a special rate of 60 percent on all imports from China. He also specified Mexico and Canada among the countries to be slapped with taxes.
In retaliation, Canada said it was already preparing to strike back should Trump proceed with his plan to slap a 25-percent tax on Canadian goods.
At present, Canadian officials are working on a list of American products that the US exports to Canada, targeting items that both send a political message and inflict a reasonable amount of economic damage, according to sources.
6. Unity Software Inc. (NYSE:U)
Unity Software (U) dropped for a third day on Friday, losing 8.93 percent to end at $20.90 each over the lack of catalyst to spark buying appetite.
In the past one- and five-year performances, the company’s share price marked a decline of 43.71 percent and 69.42 percent, respectively, indicating investor pessimism amid ongoing challenges on its earnings performance.
In its latest quarterly result, Unity reported a loss of $0.31 per share, which was better than analysts’ expectations of $0.39. Despite settling in the red, the figures showed an improvement from the previous quarter, when it beat estimates with a smaller-than-expected loss of $0.32 versus $0.44.
Unity (U) is a game engine company that creates tools that help create and run real-time 3D content, such as video games, interactive experiences, and industrial applications, across different platforms.
5. Jefferies Financial Group Inc. (NYSE:JEF)
Shares of Jefferies Financial Group (JEF) declined by 10.80 percent on Friday, ending the trading week at $71.48 apiece as investors unloaded positions after the investment bank missed fourth-quarter earnings expectations.
In the fourth quarter of the year, Jefferies Financial (JEF) posted earnings per share of 93 cents, lower than the 97 cents analysts expected. During the same period last year, Jefferies posted 29-cent earnings per share.
Revenues surged by 73 percent to $986.8 million but were weaker than expected, hurt by lower equity underwriting, according to UBS analysts.
While advisory revenues jumped 91 percent year-on-year to $596.7 million, the figure still missed UBS analyst projections of $609 million.
4. PG&E Corp. (NYSE:PCG)
PG&E (PCG) shares dived by 10.81 percent on Friday to finish the week at $17.17 each as investor sentiment was dampened by the ongoing wildfire in Los Angeles that has already destroyed thousands of structures and claimed the lives of 10 people.
While the wildfire was not located in PG&E’s service area, analysts said investors remained cautious especially since PG&E had a history of wildfire-related liabilities, with more than $30 billion in legal claims tied to previous fires that led to its 2019 Chapter 11 bankruptcy.
According to reports, the Los Angeles blaze which broke out on Tuesday already resulted in total damage and economic loss of up to $150 billion.
As the fires continue to spread, weather site AccuWeather said that the economic damages could still potentially increase.
PG&E (PCG) is an energy company with businesses in renewable energy, solar, electric vehicles, natural gas vehicles, and battery storage, among others. It has service areas in various portions of California.
3. Rigetti Computing Inc. (NASDAQ:RGTI)
Shares of Rigetti Computing (RGTI) tumbled by 11.06 percent on Friday, ending the week at $8.93 each as investor sentiment was still weighed by Nvidia Corp. CEO Jensen Huang’s recent statement that the practical use of quantum computers is still 15 to 30 years away.
Rigetti, which for months, has been riding the booming AI sector, suffered the setback as investors recalibrated their expectations for the timeline of quantum computing advancements.
Separately, AXS Investments CEO Greg Bassuk was quoted as saying in a report that quantum computing stocks’ valuations have “become a bit lofty” and that he was not surprised by the stock price’s correction.
“Broad consensus has long been that quantum computing’s mass appeal is years away so there is no real news underpinning today’s negative news,” he added.
2. Aurora Innovation Inc. (NASDAQ:AUR)
Shares of Aurora Innovation (AUR) dropped for a second day on Friday, losing 13.22 percent to finish at $6.99 each as investors sold off positions after the company reportedly sued the US Department of Transportation for arbitrarily rejecting the industry’s idea for an alternative solution.
The complaint was filed in the DC Circuit Court of Appeals on Friday.
According to Aurora Innovation (AUR), the department’s decision “stifles safety innovation and would impede the development of the autonomous trucking industry for no valid or lawful reason.”
The case stemmed from an application filed by Aurora and fellow self-driving vehicle manufacturer Waymo, in January 2023 seeking an exemption to existing rules that require truck drivers to exit their vehicle and place reflective triangles or flares on the roadway when stopped on the shoulder of a highway.
The companies sought permission for driverless trucks to instead use ultra-bright, cab-mounted warning beacons similar to those used by highway construction vehicles. On December 26, the department rejected the request.
In its decision, the agency said the companies failed to show that a national, industry-wide exemption for AV trucks would provide an equivalent level of safety in such situations.
1. Constellation Brands Inc. (NYSE:STZ)
Shares of Constellation Brands (STZ) nosedived by 17.13 percent on Friday to finish at $181.81 each after missing net sales estimates, booking only $2.46 billion versus the projected $2.53 billion.
Investor sentiment was further weighed by the company’s slashing of its annual sales and profit forecasts.
Constellation Brands (STZ) now expects annual net sales to settle between 2-5 percent from the 4-6 percent projected earlier.
“Given near-term uncertainty on when consumers will revert to more normalized spending, we have prudently lowered our growth outlook,” said Constellation Brands CEO Bill Newlands in a statement.
Commenting on the performance, Truist Securities analyst Bill Chappell said that without any catalysts on the horizon, investors “should remain on the sidelines until the story becomes interesting again.”
While we acknowledge the potential of STZ as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than STZ but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
