Quantcast

Why American Airlines Group Inc (AAL), Microsoft Corporation (MSFT) and Starbucks Corporation (SBUX) Are 3 of Today’s Worst Stocks


Shutterstock photo

InvestorPlace InvestorPlace - Stock Market News, Stock Advice & Trading Tips

It was touch and go all day for the market on the final day of the trading week, but when push came to shove as the closing bell rang, it was a stalemate. The S&P 500 ended the day at 2091.58, up just 0.10 points.

Why American Airlines Group Inc (AAL), Microsoft Corporation (MSFT) and Starbucks Corporation (SBUX) Are 3 of Today's Worst Stocks It could have been worse, however, and for owners of American Airlines Group Inc (NASDAQ: AAL ), Microsoft Corporation (NASDAQ: MSFT ) and Starbucks Corporation (NASDAQ: SBUX ), it was worse.

These three names lost an inordinate amount of ground today, mostly thanks to earnings and/or outlooks.

American Airlines Group Inc (AAL)

The good news is, American Airlines Group managed to top its first quarter estimates. The bad news is that the company isn't feeling too confident about the near future.

Last quarter, American Airlines earned $1.25 per share on revenue of $9.44 billion. Both were better than expectations of $1.18 per share and sales of $9.43 billion. Consolidated passenger revenue per available seat mile fell 7.5% as capacity growth outpaced actual demand, and was further crimped by lower fares stemming from cheaper jet fuel.

In an indirect acknowledgement that headwinds are now blowing, the company asked that AAL shareholders brace for the likelihood that revenue was apt to remain suppressed in the near-term. Specifically, American Airlines believes its current-quarter PRASM will fall between 6% and 8% .

AAL closed 4.5% lower today.

Microsoft Corporation (MSFT)

The market had been giving Microsoft CEO Satya Nadella the benefit of the doubt of late, tolerating tepid earnings and revenue growth on hopes that the company's transition from a PC software company to a cloud-oriented company would eventually pay off.

With yet another quarter of lackluster progress on the fundamental front though, investors are starting to have their doubts … if Friday's 7% selloff is any indication.

Last quarter - the company's fiscal Q3 - Microsoft earned 62 cents per share on $22.08 billion in revenue . Problem is that the market had been expecting a profit of 64 cents per share of MSFT. The top line essentially matched the outlook for $22.09 billion, but it wasn't tough for traders to see the glass as half-empty with revenue falling 5.5% on a year-over-year basis.

Starbucks Corporation (SBUX)

Last but not least, Starbucks shares lost 5% of their value on Friday following its disappointing fiscal second quarter numbers.

Last quarter, Starbucks earned 39 cents per share on $4.99 billion in revenue . Income was in line with estimates, while missed expectations of $5.03 billion.

Nevertheless, both numbers were much better than the comparisons to the same quarter a year earlier, when Starbucks earned 33 cents per share on $4.56 billion worth of revenue. Same-store sales were up 6%, though analysts were looking for a 6.7% improvement.

The concerning change in the company's loyalty rewards program earlier this month doesn't appear to be an impasse … at least not yet. Those changes led to an 8% increase in participation , and domestic enrollment in the rewards program was up 16% on a year-over-year basis.

Still, investors have their doubts SBUX can justify its lofty valuation anytime soon.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities.

More From InvestorPlace

The post Why American Airlines Group Inc (AAL), Microsoft Corporation (MSFT) and Starbucks Corporation (SBUX) Are 3 of Today's Worst Stocks appeared first on InvestorPlace .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



This article appears in: Investing , Stocks
Referenced Symbols: AAL , MSFT , SBUX , DIS



More from InvestorPlace Media

Subscribe






InvestorPlace Media
Contributor:

InvestorPlace Media

Investing, Financial News










Research Brokers before you trade

Want to trade FX?