Hot stocks: Earnings news weighs heavily on NKE, RCII, travel stocks; FXLV jumps to takeover offer
Stocks ended the third quarter with another drop on Friday, sending the Dow and S&P 500 to new lows for the year. Meanwhile, Nasdaq has come a significant distance from the 52-week low hit in June.
While continued concerns about the Federal Reserve boosted trading, earnings concerns also contributed to selling. In the most striking example, cruise ship stocks fell after disappointing results from Carnival (CCL), with Royal Caribbean Cruises (RCL) and Norwegian Cruise Line Holdings (NCLH) fell in love.
The release of financial figures also spurred sales in Rent-A-Center (RCII) and Nike (NYSE:NKE).
Elsewhere, Mark Wahlberg-backed F45 Training (FXLV) despite the negative sentiment of the day. The share rate rose more than 40% on news of a takeover bid.
Area in focus
Carnival (CCL) is reported Disappointing quarterly results and issued a compelling booking update, raising concerns about travel demand in the face of an uncertain economic situation. As a result, the earnings report boosted sales throughout the travel sector.
With EPS and EBITDA numbers below expectations and Q4 bookings elevated below historical normal, CCL is down 23% on the session. Here Pull down Royal Caribbean Cruises competing cruise lines (RCL) and Norwegian Cruise Line Holdings (NCLH), down 13% and 18% respectively.
Outstanding Gainer
An acquisition offer has fueled a wave of purchases in the battered gym chain F45 Training (FXLV). Shares rose 41%.
The company, which includes actor Mark Wahlberg as an investor, has received a non-binding takeover offer from owner Kennedy Lewis Management. According to a regulatory filing, the company, which holds a 14.6% stake in FXLV, has set a $4 per share price to buy the remaining shares it doesn’t own.
On the news, FXLV rallied 90 cents to close at $3.09. The stock went public last year at $16 a share and peaked at $17.75 shortly after going public.
Prominent denizen
Rent-A-Center (RCII) posted a significant drop, weighed down by a weak forecast included in its latest quarterly report. The earnings news sent the company’s shares down 22%.
The home appliance rental chain reported quarterly earnings and revenue that exceeded analyst expectations. However, the company has released a Disappointing predictions for Q3targets adjusted EPS of $0.85 to $0.95, down from the previous outlook of $1.05 to $1.25.
RCII ended Friday’s trading at $17.51, down $4.82 during the session. The stock also hit a 52-week intraday low of $17.50. Overall, the stock is down 64% for the whole of 2022.
Notable new lows
The release of a weak quarterly report sent to Nike (NKE) spiral. With an inventory clearing effort slashing margins, NKE fell nearly 13%, hitting a new 52-week low.
NKE topped expectations with strong earnings and revenue numbers, with top-line sales up 4% year over year. However, gross profit margin decreased 220 basis points to 44.3%.
Following the report, NKE dropped $12.21 to close at $83.12. During the session, the stock hit a 52-week low of $82.50.
Looking at the long-term, the stock is down about 22% over the past month. Meanwhile, NKE has lost almost half of its value since the end of 2021.
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