Why BP Prudhoe Bay Royalty Trust, Albemarle, and Adtran Slumped Today

The stock market eased lower on Thursday, pulling back from its gains earlier in the week as major benchmarks finished with modest losses of less than half a percent. Despite ongoing optimism about corporate earnings, the fear of a possible government shutdown this weekend has some investors nervous about what could be a difficult political environment in Washington throughout 2018 in the run-up to the midterm elections. Some individual stocks also reacted negatively to specific news affecting their businesses. BP Prudhoe Bay Royalty Trust (NYSE: BPT), Albemarle (NYSE: ALB), and Adtran (NASDAQ: ADTN) were among the worst performers on the day. Below, we'll look more closely at these stocks to tell you why they did so poorly.

BP Prudhoe Bay drops following dividend

Shares of BP Prudhoe Bay Royalty Trust fell 9% after the crude oil-focused royalty trust locked in its quarterly distribution to investors. BP Prudhoe Bay's payout was substantial, at $1.23 per unit, representing about 5% of its price as of Wednesday's close. The price decline mentioned above was on top of the drop in value stemming from the dividend, indicating that at least some investors were only interested in capturing the greater-than-normal payout and getting out as quickly as possible. With investors uncertain about how long the trust will continue to operate and therefore how long they can expect to keep receiving dividend distributions, that caution is warranted.

Albemarle loses its charge

Shares of Albemarle dropped 7% in the wake of continued pressure on stocks related to the lithium market. Lithium has been red-hot lately, helping to lift Albemarle by more than 175% over the past couple of years. Yet with strong demand for lithium for use in batteries and other applications, rival suppliers are looking at ways to boost production, and that could in turn lead to price cuts that would dampen Albemarle's ability to sustain profit growth. With today's drop, the top lithium producer has seen its shares lose 12% in just three days, but that's only a small portion of the gains that long-term shareholders have enjoyed.

Adtran extends its losses

Finally, Adtran stock finished down 11.5%. The networking and communications equipment provider continued to lose ground following the release of its fourth-quarter financial results late Tuesday, which included massive sales declines of 22% and a net loss for the period. The bad news had largely been anticipated, and CEO Tom Stanton tried to maintain a positive view on Adtran's business prospects, pointing to efforts to help customers make the transition to faster networks. Nevertheless, with the stock having lost 15% in just two days, Adtran shareholders are having a clear crisis of confidence that the company will need to fight aggressively in order to regain lost ground.

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Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.