Ten companies posted double-digit declines last week amid a series of dismal earnings performance and outlook guidance that weighed down on investor sentiment, bucking an overall strength of Wall Street’s main indices on a week’s basis.
Over the past five trading days, the Dow Jones registered growth of 0.5 percent, the S&P 500 increased by 1.47 percent, and the tech-heavy Nasdaq rallied by 2.57 percent.
In this article, we have listed the 10 names that fell the hardest last week and detailed the reasons behind their declines.
To come up with the list, we only considered the stocks with at least $2 billion in market capitalization and $5 million in daily trading volume.
A laptop and a computer monitor display a detailed stock market technical analysis chart. Photo by Jakub Zerdzicki on Pexels
10. Astera Labs Inc. (NASDAQ:ALAB)
Astera Labs suffered a 13-percent drop week-on-week, ending Friday at $87.85 apiece versus the $101.29 registered on February 7, as investors sold off positions following the release of mixed earnings performance in 2024.
On Monday, February 10, ALAB announced that its net income for the fourth quarter of 2024 jumped by 72 percent to $24.7 million from $14.3 million in the same period a year earlier, as revenues expanded 179 percent to $141 million from the $50 million in the same comparable period.
However, the fourth quarter’s figures fell short of pulling the company out of losses, having widened its net losses by a whopping 217 percent to $83.4 million in full-year 2024 from the $26.26 million registered in 2023.
But this year is expected to be “a breakout year.” According to ALAB CEO Jitendra Mohan, the company is set to enter a new phase of growth driven by revenues from all of its products, including its flagship Scorpio Fabric products for head-node PCIe connectivity and backend AI accelerator scale-up clustering.
9. Twilio Inc. (NYSE:TWLO)
Twilio Inc. saw its share prices decline by 14 percent week-on-week, finishing Friday at $125.17 as compared with the $145.65 registered on February 7, as investors sold off positions following the company’s weak outlook for the current quarter, shunning last year’s better performance.
At intra-week trading, TWLO’s share prices hovered around the $140-level, before dropping heavily on Friday following announcements that it expects to see adjusted earnings per share of 88 to 93 cents for the first quarter on revenues of $1.13 billion to $1.14 billion. The company’s outlook was short of the 98 cents adjusted EPS as projected by analysts, while the revenue guidance fell just shy of the $1.14 billion expected.
During the last quarter, TWLO narrowed its net losses by 96 percent to $12.47 million versus the $365 million registered in the same period last year, despite 11 percent higher revenues of $1.194 billion versus $1.075 billion year-on-year.
8. Millrose Properties Inc. (NYSE:MRP)
Millrose Properties fell by 14 percent week-on-week, closing Friday at $22.92 each versus the $26.74 finish on February 7, as investors continued to sell off positions in the company to reduce exposure from the recent spin-off from its parent company, Lennar Corp. (LEN).
To recall, LEN and MRP concluded a stock spin-off, involving the distribution of approximately 80 percent of MRP shares to stockholders of LEN.
Each LEN shareholder as of record date January 21, 2025 then received one share of MRP common stock.
However, with MRP now an independent publicly traded firm having just begun regular way trading, investors quickly sold off positions to lock in early profits and mitigate potential risks.
MRP engages in land purchases, horizontal development, and homesite option purchase arrangements for LEN. It anticipates to attract other homebuilders seeking to implement an asset-light strategy.
7. Fidelity National Information Services Inc. (NYSE:FIS)
Fidelity National Information Services saw its share prices lose 17.3 percent in value last week, ending Friday’s session at $68.98 versus the $83.42 on February 7 as a weak outlook for the rest of the year weighed on the company’s stock price.
During the entire trading week, FIS’ shares fell for five consecutive days after announcing first-quarter revenue expectations between $2.485 billion and $2.51 billion, and adjusted earnings per share of $1.17 to $1.22, falling below analyst consensus.
Revenues for full-year 2025 were also pegged at $10.435 billion to $10.495 billion, with adjusted EPS between $5.7 to $5.8.
Last year, FIS registered an impressive earnings performance, with net income growing 57 percent to $787 million from $502 million in 2023.
Meanwhile, net profit for the fourth quarter alone skyrocketed 390 percent to $304 million from $62 million year-on-year.
6. Coty Inc. (NYSE:COTY)
Shares of Coty Inc. fell 17 percent week-on-week, ending Friday’s session at $5.58 apiece versus the $6.76 registered on February 7 as investors sold off positions following disappointing earnings performance last year and pessimistic outlook guidance.
In its latest earnings release, COTY registered an 83-percent lower net income for the past quarter, ending at $30.6 million versus the $186 million year-on-year, pulling down its net profit from July to December by 38 percent to $121.3 million from $196.2 million year-on-year.
Net revenues for the quarter dipped by 3 percent to $1.67 billion from $1.73 billion, while six-month net revenues were flat at $3.3 billion.
Given the dismal performance, COTY cut its annual profit forecast primarily due to expectations of lower demand for cosmetics products.
The company, which operates the brand CoverGirl has seen weakness in the Asian travel retail business, particularly at airports and travel destinations in Asia, including Korea and China.
5. Hanesbrands Inc. (NYSE:HBI)
Hanesbrands slashed its valuation by 22 percent on Friday, ending at $5.88 apiece versus the $7.54 finish on February 7, as investor sentiment was weighed down by disappointing earnings performance last year coupled with the company’s sudden announcement of a change in leadership.
In its earnings release, HBI said it swung to a net loss of $12.88 million in the fourth quarter of 2024, reversing a $77.9 million net income posted in the same period a year ago. Meanwhile, net losses in full-year 2024 skyrocketed by 1,708 percent to $320 million from $17.7 million in 2023.
Revenues for the quarter grew 4.4 percent to $888 million from $850 million year-on-year, but revenues for full-year 2024 dipped by 3.6 percent to $3.507 billion from $3.639 billion in 2023.
On the same day, HBI announced that its CEO, Steve Bratspies, is stepping down from his post by the end of the year, or as soon as a successor is named. He will also exit from the company’s board of directors.
4. Informatica Inc. (NYSE:INFA)
Informatica Inc. saw its share prices decline by 22.3 percent last week, finishing at $19.75 on Friday versus the $25.45 week-on-week after posting dismal earnings performance last year.
In a statement, INFA saw net income in the past quarter fall 85 percent to $9.754 million from $64.261 million in the same period last year, while revenues dipped 3.8 percent to $428 million from $445 million year-on-year.
Despite lower net profit for the quarter, the company swung to a net income of $9.93 million in full-year 2024, reversing a net loss of $125 million posted in 2023.
Revenues for the year also inched up by 2.8 percent from $1.59 billion year-on-year.
INFA is a leading enterprise in AI-powered cloud data management, bringing data and AI to life by empowering businesses to realize the transformative power of their most critical assets.
3. SoundHound AI Inc. (NASDAQ:SOUN)
SoundHound AI nosedived by 29.7 percent on Friday to $10.97 apiece from $15.6 registered on February 7, as investors took path from Nvidia Corp.’s reduced ownership positions in the company.
Last week, NVDA submitted a regulatory filing showing its stake positions in various firms. The filing showed a 44-percent reduction in its holdings in British chipmaker Arm Holdings while exiting Serve Robotics and SoundHound AI, Inc. (SOUN).
An analyst from Triple D Trading was quoted as saying that there is no stronger vote of confidence than NVDA investing in a company.
NVDA’s divestment in SoundHound AI, Inc. (SOUN) has raised investor concern over the future of its growth trajectory, particularly as it was once seen as a promising player in the AI industry.
2. The Trade Desk Inc. (NASDAQ:TTD)
The Trade Desk dropped its share prices by 31.6 percent week-on-week, finishing Friday at $80.16 apiece versus the $117.29 registered on February 7.
The drop followed a downgraded outlook from an analyst from Evercore ISI, cutting his rating to “hold” from “buy” previously due to mixed financial results and underperformance in key areas. Additionally, the analyst cut his price target for the company by 33 percent to $90 from $135 previously.
The downgrade came after TTD missed internal revenue expectations for the first time in eight years, with figures settling at $741 million, or lower than analyst consensus of $758 million and internal guidance of $756 million.
In a statement, TTD CEO Jeff Green acknowledged the company’s performance in 2024, but said that he was disappointed “for falling short of our expectations in the fourth quarter.”
“In 2025 and beyond, we are uniquely positioned to help our clients take full advantage of data-driven advertising on the premium internet, helping them drive growth and brand loyalty for their businesses,” he said.
1. West Pharmaceutical Services Inc. (NYSE:WST)
West Pharmaceutical lost 33 percent of its value in just a week’s trading, ending Friday at $214.73 apiece versus the $321.55 on February 7 as investors sold off positions following a drop in its net income coupled with a pessimistic outlook for this year.
On Thursday, WST said net income for the fourth quarter of 2024 declined by 5 percent to $130.1 million from $137 million in the same period in 2023, while net income for the full year 2024 declined by 16.97 percent to $492.7 million from $593.4 million in 2023.
Net sales for the quarter, however, were higher by 2 percent to $748.8 million from $732 million, while net sales for the full-year period dipped by 1.9 percent to $2.893 billion from $2.949 billion year-on-year.
For this year, the company said it targets diluted earnings per share to settle between $5.97 to $6.17, a significant drop from the $6.69 reported in 2024.
While we acknowledge the potential of WST 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 WST but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.
Disclosure. None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and investors. Please subscribe to our daily free newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
