Wall Street’s main indices finished mixed on Wednesday, with the Dow Jones emerging as the sole decliner as investors digested more news of tariff threats from President Donald Trump.
The Dow Jones dropped by 0.20 percent. In contrast, the S&P 500 and Nasdaq clocked in gains of 0.49 percent and 1.22 percent, respectively.
Ten companies mirrored a mostly pessimistic trading—four of which were Chinese stocks—as traders sold off to minimize risks from the potential impact of the US’ trade war with China.
In this article, we have identified the 10 worst performers on Wednesday and detailed the reasons behind their performance.
To come up with the list, we considered only the stocks with at least $2 billion in market capitalization and $5 million in trading volume.
A stock market graph. Photo by energepic.com on Pexels
10. American Airlines Group Inc. (NASDAQ:AAL)
American Airlines fell for a fifth straight day on Wednesday, losing 4.62 percent to finish at $10.93 apiece as investors sold off positions after the company turned pessimistic on its outlook for the first quarter of the year.
In a recent regulatory filing, AAL said it now expects revenues for the first quarter of the year to remain flat from the same period year-on-year, a revision from the 3 to 5 percent expected previously.
Meanwhile, available seat miles were also expected to remain unchanged on a year-on-year basis, as compared with its previous flat to 2-percent growth guidance.
“Since the Company’s initial first-quarter guidance issued on January 23, 2025, the revenue environment has been weaker than initially expected due to the impact of Flight 5342 and softness in the domestic leisure segment, primarily in March,” AAL said.
“First-quarter total revenue is now expected to be approximately flat versus the first quarter of 2024. Based on these updated assumptions, the Company expects its adjusted loss per diluted share to be approximately ($0.60) to ($0.80),” it added.
9. United Airlines Holdings Inc. (NASDAQ:UAL)
United Airlines extended its losing streak for a fifth straight day on Wednesday, shedding another 4.73 percent to finish at $72.46 apiece, as the company continued to bear the brunt of a pessimistic sentiment on the travel and tourism industry.
UAL, alongside its peers, suffered from sell-offs as a result of the ongoing trade tensions between the United States and its trading partners, including Canada.
At a conference, UAL Chief Executive Officer Scott Kirby said UAL is set to reduce its flying capacity with the retirement of 21 aircraft and the reduction of flights in markets that used to have high traffic, including Canada.
“Where you see people cutting is the places they’ve lost money,” and where they are not the number one carrier, Kirby said.
“From an industry level, I expect you will see modest supply changes in the short term. By the time we get to August, every analyst will be writing about capacity cuts.”
8. Target Corp. (NYSE:TGT)
Target saw its share prices decline for a third straight day, losing 4.86 percent to end at $107.28 apiece as investor sentiment was dampened by a bearish industry outlook coupled with the firm’s dismal earnings performance.
Last week, TGT saw its net income in the latest quarter ending February 1, 2025, decline by 20.2 percent to $1.1 billion from $1.38 billion in the same period a year earlier, as net sales dipped by 3.1 percent to $30.9 billion from $31.9 billion.
Meanwhile, net income for 12 months decreased 1.1 percent to $4.09 billion from $4.1 billion a year earlier, while net sales were marginally down by 0.8 percent to $106.5 billion from $107 billion year-on-year.
Also last week, TGT CEO Brian Cornell announced that President Donald Trump’s tariffs on Mexico may force the company to raise prices on fruits and vegetables as soon as this week. TGT heavily relies on Mexican produce imports during the winter.
“Those are categories where we will try to protect pricing, but the consumer will likely see price increases over the next couple of days,” he said.
7. New Fortress Energy Inc. (NASDAQ:NFE)
New Fortress saw its share prices decline by 4.97 percent on Wednesday to end at $8.80 apiece as investors took early profits to minimize risks from the ongoing economic uncertainties.
NFE traded higher at the intra-day session before investors turned sellers to book profits towards the end, pulling the company’s share price down at market close.
Its intra-day performance was mostly fueled by news that it is set to kick off the construction of a $1.1-billion liquefied natural gas plant at the Mexican port of Altamira in the middle of the year. The project was in partnership with state utility CFE.
So far, NFE said it had spent $625 million for the project, mainly on the procurement of the liquefaction modules. Construction of the modules is now more than 50 percent complete.
NFE said Texas-based contractor Kiewit is building the modules and will ship them to Altamira next year.
6. XP Inc. (NASDAQ:XP)
XP retreated for a third day on Wednesday, losing 5.48 percent to end at $14.14 each as investors sold off positions following allegations from a short seller that it was engaging in a “Madoff-like Ponzi scheme.”
A report from short seller Grizzly Research targeted XP’s financial practices, particularly the operations of its fund called GLADIUS FIM CP IE, claiming that XP’s profits largely depend on deceptive financial products sold to retail clients.
It also claimed that XP engages in a Ponzi scheme through the sale of Structured Operations Certificate which are allegedly presented as proprietary trading profits but are in reality funds from new premiums.
The research said that GLADIUS which returned more than 2,419 percent over the past five years relies on the said scheme, and that without the profits from GLADIUS and an affiliated fund, COLISEU FIM CP IE, XP would reportedly be unprofitable.
XP, meanwhile, said that it was aware of the allegations, saying that it reinforces its “unwavering commitment to transparency, regulatory compliance, and strict governance” and that it “adheres to all regulations set by regulatory bodies.”
5. XPeng Inc. (NYSE:XPEV)
Shares of XPeng Inc. declined by 6.11 percent on Wednesday to end at $24.73 each, as investors disposed of positions in Chinese firms amid the ongoing trade war between the United States and China and other trading partners.
Additionally, investors repositioned their portfolios ahead of the company’s earnings release on Tuesday next week, where among the cues to look out for include its 2025 outlook guidance and whether its plan to double down on expansion into international markets would push through as intended, taking into account the economic uncertainties globally.
“This year, we will increase to 60 and will have established more than 300 after-sales service points worldwide,” XPEV CEO He Xiaopeng said earlier.
Over the next 10 years, he said that the international markets are expected to power its sales.
Analysts are generally bullish on their outlook for the company. Citi, for its part, gave the company a “buy” rating, a revision from “neutral” previously, while giving it a price target of $29, up from $13.70 previously.
4. Hesai Group Inc. (NASDAQ:HSAI)
Hesai Group declined by 6.35 percent on Wednesday to finish at $22.55 apiece, with the company not spared from a noticeable sell-off in Chinese stocks amid the ongoing trade tensions globally despite the company’s impressive earnings performance last year.
In its latest earnings release, HSAI said it swung to a net income of RMB147 million from a RMB140.9 million net loss in the same period a year earlier, as revenues grew 28 percent to RMB719.8 million from RMB561.2 million.
Meanwhile, it was able to narrow its net loss for the full year by 78.5 percent to $102.4 million from $476 million, as revenues increased by 10.7 percent to $2.077 billion from $1.878 billion.
For this year, HSAI CFO Andrew Fan said that the company is set for an exceptional 2025, with revenues expected to settle between RMB3 billion and RMB3.5 billion.
“This explosive growth not only sets the stage for unstoppable momentum but also reinforces our path to long-term industry leadership,” he said.
3. BiliBili Inc. (NASDAQ:BILI)
BiliBili Inc. dropped its share prices by 6.5 percent on Wednesday to finish at $21.29 apiece as investors sold off positions in various Chinese firms.
BILI traded lower in line with its Chinese counterparts, including XPEV, HSAI, and VNET, which were among the top losers of the trading day.
Earlier, analysts raised concerns on whether BILI could find a new online game that could mirror or exceed the success of “Three Kingdoms: Strategy Time.”
According to an analyst from Nomura, the game has the potential to remain popular over the long term, but it could lead to slow growth in the second quarter.
During the last quarter, BILI swung to a net income attributable to shareholders of RMB89.96 million from a RMB1.296 billion net loss in the same period a year earlier, as revenues grew 21.8 percent to RMB7.7 billion from RMB6.3 billion in the same comparable period.
2. Avantor Inc. (NYSE:AVTR)
Avantor lost 6.73 percent of its value on Wednesday, a third straight day, over the lack of a fresh catalyst to buoy investing appetite and lingering concerns amid downgraded outlooks.
AVTR, a life science tools company that aims to provide mission-critical products and services to the life sciences and advanced technology industries, earned a generally pessimistic outlook from analysts recently due to missed earnings estimates.
While AVTR registered a 408-percent jump in net income for the fourth quarter of 2024, net revenues, however, dipped to $1.69 billion from $1.7 billion. Revenue figures missed the $1.71 billion mark as expected by analysts.
Meanwhile, net income in the full year of 2024 also surged by 121 percent to $711.5 million from $321.1 million year-on-year.
1. VNET Group Inc. (NASDAQ:VNET)
VNET dropped its share prices by 7.64 percent on Wednesday to end at $11 apiece, in line with the decline in several Chinese stocks, as investors moved to park funds to mitigate the risks of the ongoing trade war, shunning its impressive earnings performance last year.
In its latest earnings release, VNET said it narrowed its fourth-quarter net loss attributable to the company by 99 percent to RMB11.1 million from RMB2.4 billion in the same period a year earlier, as net revenues increased by RMB2.246 billion from RMB1.898 billion.
Meanwhile, it swung to a net income of RMB183 million in full-year 2024 from a RMB2.6 billion net loss a year earlier, as revenues grew by 42 percent to RMB1.832 billion from RMB1.292 billion.
“Moving into 2025, we remain confident in China market’s growth potential. Recent AI breakthroughs are propelling AI development domestically, spurring inference demand, and reducing costs. This is boosting industry-wide enthusiasm for investing in AI, unlocking greater demand for high-performance data centers and reliable IDC services. As a leading player with a clear expansion path for such advanced capacity, we are well-positioned to capture rising market opportunities, driving our sustainable growth,” said VNET CEO Josh Sheng Chen.
While we acknowledge the potential of VNET as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than VNET but 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.
