Why Rite Aid, First Majestic Silver, and Trivago Slumped Today

Monday was a mixed day for the market, with various sectors dramatically outperforming other industries across the overall investing universe. The Nasdaq fell about half a percent, but the broader S&P 500 gained ground, and the Dow Jones Industrials finished up by about 130 points. Strength in energy overcame weakness in technology throughout most of the market, and only the Nasdaq's tech-heavy focus left it down on the day. Yet even with most market participants sharing positive sentiment, some individual stocks lost ground. Rite Aid (NYSE: RAD), First Majestic Silver (NYSE: AG), and Trivago (NASDAQ: TRVG) 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.

Rite Aid keeps falling

Shares of Rite Aid declined 9% on Monday, extending their losses from last week after the company and fellow drugstore chain giant Walgreens Boots Alliance (NASDAQ: WBA) announced that they would downgrade their formerly planned merger to a partial asset sale instead. Under the amended deal, Rite Aid will sell almost 2,200 store locations to Walgreens for $5.175 billion. Some investors believe that after the decline, Rite Aid is now a bargain, but even with a lot of cash coming from the store sale, the drugstore chain will still have extensive amounts of debt on its balance sheet. That overhang of debt will prevent Rite Aid from making certain strategic moves, such as buying out a smaller chain of drugstores or making expansion plans of its own. Today's share-price move suggests that investors are doing the math and finding the bear case more likely.

First Majestic gets tarnished

First Majestic Silver stock dropped 8% after a horrible day for the precious metals markets. Gold prices fell more than $20 per ounce to about $1,220, and silver was down about $0.50 per ounce to just above $16. Many mining stocks fell today, but First Majestic is particularly leveraged to prospects in the silver market, largely because it has avoided the trend among silver miners to diversify their exposure to include gold and other precious metals. First Majestic also has plans to bring more silver projects into production within the next several years, with the potential for as much as 20 million ounces per year of production by 2021. If silver prices remain weak, however, First Majestic will continue to suffer.

Trivago stays at home

Finally, shares of Trivago fell 12%. The downward move for the online travel provider wiped out gains from two strong days last week as market participants kept their eyes on rapidly developing stories concerning the potential for travel-related bans on international flights. The U.S. government has stepped back from calls for a laptop ban, allowing certain airlines to permit laptop and tablet use onboard U.S.-bound flights. Yet with a broader travel ban now likely to take effect pending further decisions from the Supreme Court, some fear a drop in travel that could affect portals like Trivago. Even with today's decline, Trivago has nearly doubled from its IPO price earlier this year, and if the worst fears among travel experts don't come to pass, then the stock could quickly bounce back from today's drop and push higher once again.

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