What:Shares of specialty chemicals makerPlatform Specialty Products Corp. are down more than 11% at 3:15 p.m. ET Wednesday.
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So what:There's no news out there, and trading activity has actually been relatively light, compared to the three-month average. Unfortunately, it just looks like the majority of Wednesday's activity was initiated by sellers.
Now what:Sometimes this is just what the market does. There's a good chance that some of the drop was precipitated by people selling simply because the stock was dropping. This is a common cause of investing losses -- trying to time the market, and jumping in and out of a stock simply because of what the market is doing, not what's happening with the business itself.
As to Platform Specialty Products, things stand essentially where they did back in mid-December, when the company announced a new CEO. Platform's business model is built largely on acquiring products and companies that make them, versus in-house research and development. Platform is a relatively young public company, and the share price has fallen sharply since being listed in the NYSE in 2014, as questions about the company's long-term strategy and its ability to make big profits abound.
Add in the uncertainty when the prior CEO announced his retirement, and the now-uncertainty around how the new CEO will perform, and the market is likely to remain skittish until the company demonstrates a track record of financial performance. So unless you're willing to take the time to understand its business model and strategy, and to ride out these unexplainable up-and-down days, this is probably a stock you're best avoiding.
The article Platform Specialty Products Corp. Stock Down 11% Today on Zero News originally appeared on Fool.com.
Jason Hall has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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