Why Rite Aid, MannKind, and Sears Holdings Slumped Today
The stock market gained ground on Wednesday, with major benchmarks making modest moves higher that were sufficient to keep sentiment on Wall Street positive. Investors continued to see the markets walk the tightrope between solid economic progress and potential geopolitical turmoil, and a focus on domestic issues like monetary policy and tax reform kept most market participants within their comfort zones. Yet some companies had bad news dog their shares. Rite Aid (NYSE: RAD), MannKind (NASDAQ: MNKD), and Sears Holdings (NASDAQ: SHLD) 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 Rite Aid fell 4.5% as investors continued to fear that the worst might be ahead of the drugstore retail chain. After having had to accept successively less favorable offers for a portion of its store network in order to satisfy antitrust regulators, Rite Aid now has to face the possibility that e-commerce specialists will seek to disrupt the prescription drug industry. Employers and health insurance companies are looking for any way possible to cut costs, and they'll have a big incentive to try out alternatives to traditional pharmacies if they can lead to further savings. With Rite Aid already looking at challenges to restoring the health of its fundamental business, shareholders are taking on substantial risk in hopes for a complete turnaround.
Image source: Rite Aid.
Source: Fool.com
