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:


Closing Price

CAPS Rating

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Talbots (NYSE:TLB)





Semiconductor Manufacturing (NYSE:SMI)





Seagate Technology (NYSE:STX)















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

Well, OK, we can't exactly call these stocks naughty. There are days when five-star winners and newsletter recommendations appear here. (Today isn't one of them.)

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 the 97,000-plus stock pickers in our Motley Fool CAPS community post a poor rating or a negative pitch. You should, too. Here's today's list of the worst stocks in the world.

We begin with Jamba, which yesterday analysts at Merriman Curhan Ford downgraded over ... actually, I don't know. But I assume it has plenty to do with its lackluster growth.

Jamba is a stock I once owned and recommended. I assumed that its core business -- which I know well, having spent my teenage years in its home state of California -- would hold fast as the brand expanded into other states.


Next up is Seagate Technology, which fell waaaaay short of Wall Street's estimates in its fourth-quarter forecast.

Management predicted adjusted per-share earnings of $0.41-$0.45 on $2.85 billion to $3 billion in revenue. Analysts, by contrast, were looking for $0.61 a share on $3.1 billion in sales.

Executives didn't speak to the difference in a company statement, preferring instead to tout "solid" third-quarter results. That's fair. Nevertheless, the miss strongly suggests that Seagate's lack of truly rebellious innovation in a very competitive market is hurting margins.

And now, thanks to the researchers at IBM (NYSE: IBM  ) , a bad situation could become dire within a few years. I'll be selling my shares as soon as the Fool's disclosure rules allow.

But our winner is Talbots, which yesterday lost the backing of two banks -- Bank of America (NYSE: BAC  ) and HSBC -- that had been supplying more than $260 million in credit to the retailer.

Talbots, a serial cash burner, has been an awful stock for months. Foolish colleague Alyce Lomax, the CAPS score leader on Talbots with 123 points, put it best in February, I think:

Talbots is doing a little clean-up, so maybe, just maybe, things will look a bit brighter in another year's time, since things look terrible now. However, Talbots shareholders have already waited several years for improvement, and it's been a painful exercise in prolonged malaise and ever-shrinking stock price. Plus, when problems go on this long, you've got to wonder if the brands are simply shot and customers lost.

Couldn't have said it better, Alyce.

Talbots ... badly in need of a new corporate credit card, and 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.

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

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10/21/2016 4:00 PM
STX $34.50 Down -0.48 -1.37%
Seagate Technology CAPS Rating: ****
TLB.DL $0.00 Down +0.00 +0.00%
The Talbots, Inc. CAPS Rating: *
BAC $16.67 Up +0.11 +0.66%
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SMI $6.24 Down -0.02 -0.32%
Semiconductor Manu… CAPS Rating: ***