TLRD - Why Duluth Holdings Tailored Brands and Adverum Biotechnologies Slumped Today
Thursday brought yet another day of gains for the Dow Jones Industrials and other key benchmark indexes. Market participants appreciated signs that their fears about global economic growth and escalating trade tensions might soon prove to have been overblown, especially given a more agreeable tone from Washington concerning negotiations with Chinese officials. Yet even though the market rose broadly, some individual stocks lost ground due to company-specific challenges. Duluth Holdings (NASDAQ: DLTH), Tailored Brands (NYSE: TLRD), and Adverum Biotechnologies (NASDAQ: ADVM) were among the worst performers. Here's why they did so poorly.
Shares of Duluth Holdings dropped 11% for the day after releasing its second-quarter financial results. Its sales rose 10% from year-ago levels, but gross margin fell more than three percentage points. Duluth's profits also dropped substantially year over year. Founder Stephen Schlecht, who recently took over as CEO from Stephanie Pugliese after her late August exit, admitted that "our performance in the first half of this fiscal year fell below our expectations." Schlecht is convinced that focusing on the upcoming holiday season will give it a successful finish to the fiscal year, but investors seem to have more doubts about whether Duluth can get things turned around that quickly.
Image source: Duluth Holdings.