Becton, Dickinson and Company (BDX) shares plunge 20.25% in four days, hitting 5-year low

Becton, Dickinson and Company (BDX) shares fell 1.11% today, marking the fourth consecutive day of decline, with a total drop of 20.25% over the past four days. The stock price hit its lowest level since January 2017, experiencing an intraday decline of 2.20%.

The strategy of buying BDX shares after they reached a recent low and holding for 1 week resulted in poor performance over the past 5 years. The strategy's return was -0.19%, significantly underperforming the benchmark return of 39.28%. The excess return was -39.47%, and the CAGR was -0.08%. The strategy also had a Sharpe ratio of -0.05, indicating negative risk-adjusted returns. With a maximum drawdown of -2.12% and a volatility of 1.69%, the strategy carried notable risk and loss potential.

One of the primary factors influencing Becton, Dickinson and Company's (BDX) stock price is the recent decline in stock value by 31% over the past three months. This decline is likely due to negative market sentiment, despite the company's differing financials. The company's return on equity (ROE) stands at 5.9%, which is below the industry average of 12%. This lower ROE could be contributing to the lackluster stock performance. Additionally, the company has a significant payout ratio of 68%, which limits reinvestment opportunities. However, future forecasts indicate a drop in the payout ratio to 26% and an expected increase in ROE to 17%. These factors suggest ongoing concerns about the company's ability to generate and retain earnings effectively, impacting its stock valuation.