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The stock market gave ground Thursday, with the Dow Jones Industrial Average the three-digit drop and the other major market indices follow with a drop of almost 0.5%. Investors appeared inclined to quit after the strong start to the year, with fears of a possible deterioration in the strength of the economy and the geopolitical climate weighing on confidence. The bad news of some of the leading companies has also hurt the market as a whole. Domino's Pizza (NYSE: DPZ), Carbon black (NASDAQ: CBLK), and NetEase (NASDAQ: NTES) were among the worst performers. Here's why they hurt so badly.
Domino is burned
Domino's Pizza shares fell 9% after the restaurant chain posted mediocre results for the fourth quarter of 2018. Comparable store sales growth was 5.6% higher in the market US, but international sales rose only 2.4%. what many investors hoped to see. Shareholders also are not satisfied with the 25% increase in Domino's adjusted earnings per share. Even an 18% increase in the pizza chain's dividend at $ 0.65 per share was not enough to spark enthusiasm. Despite this decline, CEO Ritch Allison remained optimistic about Domino's future and shareholders could see a quick rebound if the company's ongoing expansion plans materialize.
Source of the image: Domino.
Carbon black sees a key departure
Carbon Black, a specialist in cybersecurity, saw its shares fall 24% after the company released its financial results for the fourth quarter and announced the departure of its leaders. Carbon Black's results appeared reasonably sound, with sales up 32% from the same period last year, up 27% from the prior year, and the Customer growth was also encouraging. However, the company announced that CFO Mark Sullivan would resign in early March, and his forecast for 2019 indicated a slowdown in growth prospects for the coming year. Wall Street analysts responded by offering price and price reductions, which bodes poorly for the company's efforts to focus more on cloud-based offerings.
NetEase loses a ride
Finally, NetEase shares fell by 6%. China's video game specialist announced a 36 percent rise in revenue in the third quarter of its fiscal year, helping to boost adjusted net income by 26 percent. However, despite the strength of its online gaming business, weaker results from e-commerce, advertising services and the innovative business division detracted from NetEase's overall results. In addition, more and more companies are struggling to gain market share in video games in China and in international markets. Overall, this is a big challenge for NetEase, and shareholders are unsure if the company is up to the task after a difficult year for the stock.
Dan Caplinger has no position in the mentioned actions. The Motley Fool owns shares and recommends NetEase. Motley Fool has a disclosure policy.
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