UNFI - Why Delta Air Lines United Natural Foods and Acuity Brands Slumped Today
The fourth quarter hasn't started out well for the stock market, and Wednesday's declines for major benchmarks were even more severe than Tuesday's. Investors increasingly fear that the U.S. economy is moving toward a recession, and they're concerned that many high-flying stocks will lose their support if overall market momentum shifts downward. In addition, some well-known companies faced significant challenges that created even larger losses in their share prices. Delta Air Lines (NYSE: DAL), United Natural Foods (NYSE: UNFI), and Acuity Brands (NYSE: AYI) were among the worst performers. Here's why they did so poorly.
Shares of Delta Air Lines fell nearly 5% after the airline giant warned that its third-quarter sales might not have grown at as quick a pace as previously hoped. Delta predicted that adjusted revenue will come in about 6.5% higher in the third quarter than in the year-ago period. Investors had expected a growth rate closer to 7%, and even though Delta's estimate of earnings between $2.20 and $2.30 per share was slightly more favorable than previously anticipated, shareholders nevertheless expressed their concern. Fundamentally, though, the company saw healthy traffic levels and load factors during September, and anything short of a full-blown recession might well leave the airline looking surprisingly strong in investors' eyes.
Image source: Delta Air Lines.