Why Chesapeake Energy, Avon Products, and National Beverage Slumped Today

By Dan CaplingerMarketsFool.com

Thursday didn't bring investors too much excitement in the market, as major benchmarks finished the day little changed yet again. The Dow Joneshasn't finished the day with a triple-digit move in seven trading sessions, and investors seem torn between the positive prospects of future economic growth and the potential negative impact of uncertainty about the future course of government policy and geopolitical shifts. Also hurting market sentiment were company-specific stories that pulled down individual stocks, and Chesapeake Energy (NYSE: CHK), Avon Products (NYSE: AVP), and National Beverage (NASDAQ: FIZZ) 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.

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Chesapeake deals with disappointment despite strong results

Shares of Chesapeake Energy lost 7% even though the energy company posted a relatively strong performance in its first-quarter financial report. Chesapeake's report included a better per-share earnings figure than investors had expected to see, and revenue soared almost a fifth higher than most of those following the stock had predicted. Cost-cutting measures and strong pricing helped bolster margin figures, and many believe that the future could be even brighter for Chesapeake as it adapts to changing conditions. Yet the drop in oil prices toward the $45-per-barrel level spooked energy investors throughout the industry, and even good backward-looking results from Chesapeake weren't enough to convince shareholders that the future wouldn't bring renewed pressure on the energy company's sales and profits.

Image source: Chesapeake Energy.

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Avon isn't calling

Avon Products stock fell 22% after the personal-products specialist issued its first-quarter financial report. Avon surprised investors by posting a loss for the quarter, with red ink of $36.5 million working out to a per-share loss of $0.10. Shareholders had hoped that Avon's turnaround efforts would have come further by now, with the company now being in its second year of a three-year transformation plan that it hopes will produce substantial recurring cost savings and steeper revenue growth. It's too early to tell whether investments in social media-based selling and other sales channels will pay off, but investors seem to be nervous about Avon's ability to sustain positive momentum as it goes through significant changes in its core business.

National Beverage falls flat

Finally, shares of National Beverage dropped 8%. The maker of LaCroix sparkling water responded to a critical report from Maxim Group, which National Beverage said "contains self-serving, misguided valuation and flawed analysis." CEO Nick Caporella went to great lengths to explain National Beverage's unique business strategy, including proprietary metrics for its LaCroix and Shasta brands and integration of promotional efforts with the desires of its loyal consumer base. Caporella went so far as to call its drinking customers "a cult," and some likely saw the company's response to Maxim as protesting too much. Even after today's drop, though, National Beverage shares have still nearly doubled in less than a year, showing just how far the once-obscure beverage company has come.

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