Stock market at the same point as a month ago but Lowe's stock down $25 a share....essentially 12%. I wonder why.
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Just read an interesting article discussing the number of large hedge funds that are holding LOW in their portfolio.
https://finance.yahoo.com/news/hedge-funds-think-lowe-companies-150954338.html
Article goes on to point out there has been a 14% decrease in the number of hedge funds holding LOW stock in the last quarter alone. Should Bill Ackman of Pershing Square start to sour on LOW stock then I would expect things would get very interesting and very fast.
Some critics blame the “financialization” of stocks, meaning the uncoupling of a company’s share price from its business performance. Beyond the wild rides of “meme” stocks such as AMC, they point to shares whose prices have skyrocketed in a way that is not obviously justified by revenue or profit or by likely changes in revenue or profit. This may be driven by Keynesian animal spirits or by maneuvers such as stock buybacks. There may be some merit to that criticism, but it is limited: Institutional investors and reasonably intelligent individual investors know how a buyback works and that it is a maneuver that may boost the performance of a company’s shares without boosting the performance of the company’s core business. In the long term, managing for share price rather than for business performance should impose real costs on firms as they divert funds away from research and development or other internal investments oriented toward improving the performance of the business. But it is not clear that this is happening, at least in a robust way that would persuade business leaders to change their ways. Google shares have more than trebled in value in the past five years -- and when is the last time Google brought something truly interesting to market?
The company is surviving on Covid, stimulus money and unemployment money, which will all run out soon. The public will not be spending like they have been. We'll see!
It’s called profit-taking. Some holders of the stock decided to take their profits and sell. Nothing to see here.
The stock hit a high of $211.31 on May 10, closed at $189.91 June 4, down $21.4 which is basically 10%. Guessing it's a combination of our investors not being overly impressed with our last quarterly report combined with the fact that with the pandemic truly rounding the corner our prospects are not as favorable going forward.
It finished at -39 cents a share. At what point was it down $25.00?
I believe they are running out of buyback money