5 Stocks in the Red Tuesday

by: Alex Shadunsky

With the markets dropping again on Tuesday, the list of losers was long, led by five companies releasing disappointing earnings and/or guidance.

Trex (NYSE:TREX) tumbled 15% after reporting weak Q2 preliminary revenue. The company said that its Q2 revenue will be approximately $78 million. The company had previously provided revenue guidance of $115 million. Management said that poor weather and, to a lesser extent, the unfavorable macroeconomic environment, caused the lower-than-expected revenue performance. Many parts of the country experienced major winter storms through April, which were then followed by heavier-than-normal precipitation during most of May, further delaying the start of the decking season.

It wasn't all bad though. The company said that sales order activity in June exceeded order activity in June 2010 by 15% as the weather improved. Order activity in the first week of July continued at a pace above July of last year.

Trina Solar (NYSE:TSL) closed 8% lower after announcing changes to its Board of Directors and Committees. Mr. Peter Mak, an independent director and chairman of the audit committee of the company, resigned from the board of directors and audit committee effective July 10, 2011, to focus on other personal and professional pursuits. Mr. Jerome Corcoran, an independent director, was appointed chairman of the audit committee of the board to replace Mr. Mak. Dr. Yeung Kwok On, an independent director, was appointed to replace Mr. Corcoran as chairman of the corporate governance and nominating committee of the board. Mr. Qian Zhao, an independent director, was appointed to the corporate governance and nominating committee of the board to replace Mr. Mak.

Vitran (VTNC) closed 13% lower after announcing disappointing Q2 guidance. The company said that despite the year-over-year ( y/y) improvement in second quarter tonnage of 15.8% within the U.S. Less-than-truckload (LTL) business unit, labour costs surpassed the tonnage gains. The outstanding performance within the Canadian LTL business unit and Supply Chain Operation (SCO) segment were eclipsed by the poor operating results in the U.S. LTL business unit. Both of these operations exceeded the prior year financial results and the SCO segment recorded another record quarter. On a consolidated basis the second quarter adjusted loss per share is expected to range from a loss of $0.06 to a loss of $0.03. Analysts expects EPS of $0.23.

Quest Software (NASDAQ:QSFT) tumbled 12% after issuing a weak outlook. The company said that revenue is expected to be between $201 and $204 million. Based on expected total revenue and preliminary estimates of expenses, pro forma earnings per share are expected to be between $0.22 and $0.24 vs. analyst forecast of $0.29. Quest Software also revised previously issued guidance for fiscal year 2011. The growth rate for total revenue is now expected to be between 11% and 12%, and pro forma operating margins are expected to be between 19% and 20%, below the previously announced guidance of 16% growth rate for total revenue and approximately 21% for pro forma operating margins.

Powerwave Technologies (NASDAQ:PWAV) fell 16% after issuing Q2 and FY11 guidance. Powerwave announced that it anticipates that revenue for Q2 to be in the range of $168 million to $172 million vs. analyst forecast of $170 million. The company further said that it continues to believe that it is on track for meeting the bottom range of its 2011 annual revenue guidance of $650 million to $680 million.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.