Wednesday's Worst Stocks in the World

Bad days. We all have them; some of us deserve them.

Here are five stocks whose naughty ways drew investors' scorn on Wednesday:

Company

Closing Price

CAPS Rating (5 max)

% Change

52-Week Range

Jamba (NASDAQ:JMBA)

$3.13

***

(29.66%)

$3.03-$12.25

Trina Solar (NYSE:TSL)

$37.37

**

(23.55%)

$17.06-$73.06

Patterson Companies (NASDAQ:PDCO)

$29.08

***

(22.70%)

$28.50-$40.08

Stein Mart (NASDAQ:SMRT)

$5.76

**

(14.03%)

$5.54-$17.17

Trans World Ent. (NASDAQ:TWMC)

$4.89

*

(10.77%)

$3.62-$6.98

Sources: The Wall Street Journal, Yahoo! Finance, Motley Fool CAPS.

Naughty?
Well, OK, we can't exactly call these stocks naughty. But none of them get much love from our 75,000-person-strong Motley Fool CAPS community of amateur and professional stock pickers.

To the contrary -- when it comes to these stocks, CAPS investors have gone thumbs-down more often than film critic Roger Ebert. They don't believe any of these stocks are worth owning, and that some may even be worth shorting.

Which of today's candidates is worst? Read on, dear Fool.

Worse
We begin with Trina Solar, which reported worse-than-expected third-quarter profits and declining margins. To compensate, Trina said it will expand into the beefier business of polysilicon production.

All-Star analysts at Bank of America Securities, who still rate the stock a buy, call that a good idea. But they also caution that the move could lead to further dilution.

Talk about a no-brainer. With or without the expansion, Trina, a serial cash burner, seemed destined for another trip to the capital markets. Behold:

Numbers in Millions

2006

2005

2004

Cash from operations

($54.0)

($8.0)

($1.9)

Capital expenditures

($41.4)

($7.7)

($0.7)

Free cash flow

($95.4)

($15.7)

($2.6)

Source: Capital IQ, a division of Standard & Poor's.

Worser
Next up is smoothie sultan Jamba, which, these days at least, is wearing a dull crown. Bearish CAPS investor stocksracer put it starkly in late October:

Costs are killing this wonderful drink brand company. I personally love Jamba Juices. They are healthy and [boost] my spirits. However, the current management is not getting it done for the stockholders. The stock will dip further this season.

Oh how right he was. Third-quarter earnings were awful.

I know, it doesn't look like it at first glance. Revenue rose 24%. Comps were up 3.3% systemwide. And Jamba opened 24 new company-owned stores during the quarter. (New stores tend to do very well for Jamba.)

Here's the problem: Where Jamba is supposed to be strongest, in its home state of California, comps rose just 1.2%. That at least suggests the juicer isn't able to command the same brand power as Starbucks and Chipotle.

Of course, as the owner of more than a handful of shares of Jamba, I'd love to be wrong about that.

Worst
Finally, our winner is dental equipment supplier Patterson Companies, which came within spitting distance of telling the world that the housing bust gave it a cavity. Seriously. Quoting CEO James Witz from the company's press release:

We are cautious about the near-term outlook of our equipment business, since it appears that certain economic and industry conditions may be causing some customers to temporarily delay new capital investments in their practices. [Emphasis added.]

Bold, you say? You have no idea. Witz goes on to say that, because of these nebulous "economic and industry conditions," Patterson was forced to reduce its full-year earnings guidance.

I'd be more forgiving here if health-care spending wasn't on the rise and if Patterson had the same history of improving returns on capital that peer Henry Schein has.

Return on Capital

Trailing 12 Months

2006

2005

2004

Henry Schein

11.2%

10.1%

9.6%

8.2%

Patterson Companies

13.4%

13.5%

14.0%

14.3%

Source: Capital IQ, a division of Standard & Poor's.

Whoops.

Patterson Companies and its let's-cover-our-tracks-by-blaming-the-economy management team ... Wednesday's worst stock in the CAPS world.

Do you agree? Disagree? Let us know what you think by signing up for CAPS today. It's 100% free to participate.

See you back here on Monday for more stock horror stories.


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