about 4 years ago • 2 mins
WPP has taken the old adage “there’s no such thing as bad publicity” a bit too literally: the PR and ad agency cut its growth outlook on Thursday, and its shares tumbled by their most since 1992 🙈
WPP’s revenue fell 1.6% in 2019, and the company admitted it’s not expecting that to rebound this year. It’ll apparently be too busy trying to fend off competition from tech powerhouses like Google and Facebook, which are taking up more and more of the advertising market. Oh, and WPP’s unsatisfying 2020 outlook doesn’t take into account the potential impact of the coronavirus outbreak, either 😫
The epidemic is on AB InBev’s mind too, and not just because it owns the unfavorably named Corona brand: the world’s largest beer-maker warned on Thursday that its first-quarter sales will fall by 10%, with China’s nightlife grinding to a halt and the company shutting its breweries in the country 🍺 The tediously named Standard Chartered, meanwhile, also acknowledged the virus will hit its 2020 profit: the British bank – already struggling with a recession in Hong Kong – makes almost 70% of its revenue in Asia.
Shares of all the above dropped heavily after their announcements on Thursday. But herein lies a valuable lesson: when investors are selling off heavily – as they have been all week – try not to throw the baby out with the bathwater 🛁 Electronics retailer Best Buy just reported fourth-quarter results that exceeded investors’ expectations, but its shares initially fell on Thursday too.
Clearly, tumbling stock markets don’t exactly make for an ideal environment for an initial public offering. That could be why retail giant Walmart announced earlier this week that it’s thinking about selling its stake in UK supermarket Asda to private equity investors, rather than pressing ahead with its plan to float the grocer on the stock exchange.
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