Megaport Ltd (ASX:MP1) and Temple & Webster Group Ltd (ASX:TPW) shares are two of four dropping notably lower on Wednesday…
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In late morning trade the S&P/ASX 200 Index (ASX: XJO) has bounced back from yesterday’s decline and is pushing higher. At the time of writing, the benchmark index is up 0.2% to 6,196.6 points.
Four shares that have failed to follow the market higher today are listed below. Here’s why they are dropping lower:
CIMIC Group Ltd (ASX: CIM)
The CIMIC share price is down 2% to $22.04. Investors have been selling the engineering company’s shares after it advised that it will write-off a further $1 billion after losing a court battle with Chevron. This relates to cost blowouts on a jetty for the Gorgon natural gas project in Western Australia.
Megaport Ltd (ASX: MP1)
The Megaport share price has sunk almost 8% lower to $15.48. This follows the release of its first quarter update this morning. Although the elastic interconnection services provider delivered further growth in customer and recurring revenues, it was slower than the market has become accustomed to. However, a strong rise in port numbers during the quarter means that management expects its growth to accelerate again in the second quarter.
Mesoblast limited (ASX: MSB)
The Mesoblast share price has fallen 3.5% to $3.28. The catalyst for this appears to news that the biotech company is being sued by shareholders in the United States. Bronstein, Gewirtz & Grossman has launched a class action alleging that Mesoblast made materially false and misleading statements. This includes comparative analyses between its Phase 3 trial and three historical studies that did not support the effectiveness of remestemcel-L for steroid refractory acute graft versus host disease (aGVHD).
Temple & Webster Group Ltd (ASX: TPW)
The Temple & Webster share price has crashed 15% lower to $11.94. Investors have been selling the online homewares and furniture retailer’s shares after the release of a trading update. Although that update revealed further explosive growth, it appears as though some investors were expecting even better. Though, it is worth noting that the company’s revenue and earnings growth were well ahead of Goldman Sachs’ estimates. It is forecasting first half revenue growth of 70.3% and EBITDA of $7.3 million. Temple & Webster’s financial year to date revenue growth is 138% and first quarter EBITDA is $8.6 million.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends MEGAPORT FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Temple & Webster Group Ltd. The Motley Fool Australia has recommended MEGAPORT FPO and Temple & Webster Group Ltd. 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. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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