Tuesday's Worst Stocks in the World

Bad days. We all have them; some of us deserve them. These five stocks' naughty ways drew investors' scorn on Tuesday:

Company

Closing Price

CAPS Rating (out of 5)

% Change

52-Week Range

ARM Holdings (NASDAQ:ARMHY)

$5.59

***

(20.82%)

$5.57-$10.07

VCA Antech (NASDAQ:WOOF)

$32.13

***

(18.66%)

$31.40-$46.23

Principal Financial (NYSE:PFG)

$53.10

***

(11.22%)

$51.00-$70.85

Barnes & Noble (NYSE:BKS)

$29.49

**

(10.74%)

$26.24-$43.80

CBL & Associates (NYSE:CBL)

$24.59

*

(10.35%)

$21.12-$50.36

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

Naughty?
Well, OK, we can't exactly call these stocks naughty. There are days when five-star winners or newsletter recommendations appear here. (Today, for example.)

But if you're an investor, you'll have plenty of bad days. The trick is to avoid dating -- or, worse, marrying -- your losers. That's why I listen when our 83,000-strong Motley Fool CAPS community of stock pickers chimes in with a poor rating or a negative pitch. You should, too -- starting with today's list of the worst stocks in the world.

Worse
We begin with Barnes & Noble, which a JPMorgan analyst downgraded yesterday over broader economic concerns and tough competition. There's no shortage of the latter -- Borders (NYSE: BGP  ) and Amazon.com (Nasdaq: AMZN  ) , for example.

But that couldn't have been news to CAPS investors, including All-Star abitarecatania. Quoting from his pitch last month:

E-books will do to you, what iTunes did to Tower Records ... People sitting around drinking coffee in a 12,000 [square foot store] is not going to pay the rent ... Public library is still free and just as close to home ...

'Nuff said.

Worser
Next up is Principal Financial, which on Monday after market close reported an 88% decline in fourth-quarter earnings. More troubling, though, is what caused the collapse. Principal suffered a $211 million loss in its investment portfolio, including $49 million attributed to subprime securities.

It gets worse. As an asset manager, Principal is subject to the whims of Mr. Market -- not a very good position to be in right now. Here's how company president and chief operating officer Larry Zimpleman put it in a statement:

Looking forward, our 2008 results will clearly be impacted by difficult market conditions -- continued uncertainty around the economy, continued adverse credit conditions, and continued volatility in asset values and in the equity markets, including a 6 percent decline in the S&P 500 Index in the month of January.

Yeesh.

Worst
But our winner is VCA Antech. As a supplier of veterinary medicine, it's supposed to be insulated from broader economic concerns. Not this time. Quoting VCA chief Bob Antin, from a company statement:

We believe that, historically, the animal healthcare industry and our business have been relatively resistant to changes in the general economy, but not immune to them. However, the fourth quarter results appear to indicate that we were marginally impacted by the uncertainty in the economy. In addition, the timing of the Christmas and New Year holidays, the California fires, the weather and competition also had an adverse impact on our results. [Emphasis mine.]

I've no doubt that Antin is correct pointing out what went wrong. But am I the only one troubled by his list of excuses ... I mean, factors ... that contributed to the miss? Watch out for low-flying butterflies.

VCA Antech and its whoops-didn't-see-that-coming management team ... Tuesday'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.

I'll be back tomorrow with more stock horror stories.


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