Here’s Why These Stocks Are Trading Lower on Wednesday

The US stock market is trading lower today following weak earnings reported by phone and utility companies, as well as some retailers.

Among the stocks that are dragging the market down are Barnes & Noble, Inc. (NYSE:BKS), Target Corporation (NYSE:TGT), Cree, Inc. (NASDAQ:CREE), 21Vianet Group Inc (NASDAQ:VNET), and Lowe’s Companies, Inc. (NYSE:LOW). Let’s have a closer look at the developments that caused these stocks to plunge and take a look at some investors that are bullish on them.

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Barnes & Noble, Inc. (NYSE:BKS) is trading down after the company ousted its CEO Ronald Boire, who was hired less than a year ago, saying that he “was not a good fit”. Leonard Riggio, the company’s executive chairman and one of its founders, has postponed his retirement and will fill in as the CEO, while Barnes & Noble finds a replacement. Earlier today Gabelli & Co. downgraded the stock to ‘Hold’ from ‘Buy’. Barnes & Noble, Inc. (NYSE:BKS) continues to have a tough time in terms of traffic due to fierce competition from Amazon.com, Inc. (NASDAQ:AMZN), which continues to dominate. At the end of June, David Abrams’ Abrams Capital Management held 10.42 million shares of Barnes & Noble.

On the other hand, shares of Target Corporation (NYSE:TGT) are trading in the red following the release of the company’s results for the second quarter, which included revenue of $16.2 billion, which was lower than estimates of $17.13 billion, while EPS of $1.23 was higher than the expected $1.12. Same store sales declined by 1.1% during the quarter, versus expectations of 0.9%. The company also provided net-income guidance in the range of $0.75 to $0.95 per share for the third quarter, while for the full year, net income per share is expected between $4.36 and $4.76. Among the investors in our database, Columbus Circle Investors holds around 1.34 million shares of Target Corporation, according to its 13F filing for the end of June.

On the next page, we are going to discuss the results reported by Cree, Inc. (NASDAQ:CREE), 21Vianet Group Inc (NASDAQ:VNET), and Lowe’s Companies, Inc. (NYSE:LOW).

Cree, Inc. (NASDAQ:CREE)’s stock has lost over 14%, so far on Wednesday, after the company reported revenue of $388.41 million for the fourth quarter of fiscal 2016, topping analysts’ estimates of $385.83 million, while adjusted EPS of $0.19 missed the expectations by $0.01. Cree expects full-year consolidated operating income guidance in the range of $356 million to $378 million for the first quarter of fiscal 2017. Chuck Royce’s Royce & Associates owned 443,200 shares of Cree at the end of the second quarter.

Shares of 21Vianet Group Inc (NASDAQ:VNET) have slid by 12% on the back of the company reporting its results for the second quarter. While its revenue of $137.1 million managed to beat the consensus estimate of $128.17 million, the net loss of $0.17 per share missed expectations by $0.08. The company provided revenue guidance in the range of RMB900 million ($135.42 million) to RMB940 million ($141.44 million) for the third quarter, while for the full year the revenue guidance is between RMB3.62 billion ($545 million) and RMB3.66 billion ($551 million). One of 21Vianet Group’s largest shareholders is Jim Simons’ Renaissance Technologies, which reported ownership of 723,300 shares in its last 13F filing.

Finally, Lowe’s Companies, Inc. (NYSE:LOW)’s is trading lower after the company reported a second-quarter revenue of $18.26 billion, which missed the estimates by $190 million, and EPS of $1.37, versus expectations of $1.42. The company revised its guidance for 2016 with sales expected to increase by 10% while, comparable sales are expected to grow by 4%. Edgar Wachenheim’s
Greenhaven Associates owns 8.31 million shares of Lowe’s Companies as of the end of June.

Disclosure: None