Why Square, Western Digital, and Weatherford International Slumped Today
Monday was the first regular day that investors in the stock market have seen in a while, with post-holiday trading reflecting a solid Thanksgiving weekend from the retail sector balanced by weakness in other areas. Major benchmarks were mixed and little changed from where they ended Friday's holiday-shortened session, but investors kept their attention squarely on Washington, where the Senate will take up tax reform in the homestretch of the year. Despite generally upbeat viewpoints on the market as a whole, shares of some companies posted significant losses. Square (NYSE: SQ), Western Digital (NASDAQ: WDC), and Weatherford International (NYSE: WFT) were among the worst performers on the day. Below, we'll look more closely at these stocks to tell you why they did so poorly.
Shares of Square dropped 16%, more than wiping out its double-digit percentage gain from last week. The electronic payment pioneer's rise had stemmed from optimism surrounding Square's embracing of bitcoin-based transactions within its platform. Yet after two straight weeks of gains, analysts at BTIG downgraded the stock from neutral to sell, citing concerns about the ability for Square to reach consistent profitability in the near future. Other analysts have seen Square's prospects more favorably, but the strategic bitcoin move does have a chance of backfiring if the cryptocurrency's recent explosive move higher reverses itself.
Image source: Square.
Source: Fool.com