During a tough third quarter for Wall Street, a healthcare stock emerged as the clear winner, while two solar companies struggled to perform. Amgen, a biotechnology company, was the best-performing stock in the Dow Jones Industrial Average, rising 21% in the quarter. The company’s strong second-quarter earnings and increased revenue forecast for 2023 boosted investor confidence. Additionally, Amgen received approval from the Federal Trade Commission for its acquisition of Horizon Therapeutics, further solidifying its position in the biopharmaceutical industry. Zions Bancorp was the top performer in the S&P 500, with a 30% rise in its stock. The lender’s second-quarter earnings beat expectations, and a potential third-quarter outperformance to net interest income is expected to further benefit the stock.
On the other hand, Walgreens Boots Alliance experienced a significant decline, falling 22% in the quarter and being the worst-performing stock in the Dow. The retail pharmacy chain faced challenges after demand for Covid-19 tests dropped, prompting a decrease in its full-year profit outlook. The departure of both the Chief Financial Officer and the Chief Executive further impacted the stock negatively. In the solar industry, SolarEdge Technologies and Enphase Energy struggled due to rising interest rates and a decline in solar-power demand. SolarEdge’s third-quarter revenue forecast fell below Wall Street estimates, leading to a 52% tumble in its stock. Enphase Energy, a maker of microinverters, issued lower-than-expected third-quarter revenue guidance. However, analysts believe that the solar industry will recover in 2024 as interest rates cool, presenting an opportunity for investors.
In summary, the third quarter of 2023 saw Amgen and Zions Bancorp as top performers in the healthcare and financial sectors, respectively, while Walgreens Boots Alliance, SolarEdge Technologies, and Enphase Energy faced challenges and ended up as the worst performers. Amgen’s strong earnings and its successful acquisition played a crucial role in its positive performance. Conversely, Walgreens suffered from declining demand and changes in leadership, while the solar companies were impacted by rising interest rates and a decline in solar-power demand. However, analysts remain optimistic about the long-term potential of these companies, particularly Enphase Energy, as they expect a recovery in the solar industry.