Tuesday'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 Tuesday:

Naughty?
Well, OK, we can't exactly call these stocks naughty. There are days when five-star winners and newsletter recommendations appear here. Today, sadly, is one of those days.

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 100,000-person-strong Motley Fool CAPS community of stock pickers speaks with a poor rating or a negative pitch. You should too.

Thus, here is today's list of the worst stocks in the world.

Worse
We begin with Gildan Activewear, a top growth stock that I've endorsed, but which on Tuesday reduced second-quarter earnings guidance from $0.42 to $0.35 thanks to operational problems. Quoting from a company statement: "The lower than anticipated growth ... is primarily due to lower than projected unit sales growth in activewear as a result of a shortfall in production for the Dominican Republic textile facility, a write-down of inventories of discontinued retail product-lines pursuant to the rationalization of Gildan's product-mix within the sock category, and additional costs incurred to service mass-market retailers during the integration of retail information systems."

Wait, it gets worse. Even though Gildan is cutting estimates by just $0.07 in Q2, the effects of the miss will continue to be felt. Executives cut full-year guidance by $0.40 -- from its January guidance of $1.85-$1.90 per share to $1.45-$1.50 a share.

Worser
Next up is Merck, which suffered the indignity of a thumbs-down from the FDA for its latest creation, Cordaptive, for controlling cholesterol. Foolish colleague Brian Orelli put it best here, I think. Quoting:

Until investors get more information, it's anyone's guess if this is a six-month or six-year delay in getting Merck turned back in the right direction. My best guess is that the reason the FDA is worried about the flushing inhibitor is that not much is known about its long-term safety. That could result in a very restrictive label -- limiting sales to only patients with very high cholesterol levels -- or more clinical trials, which would mean a lengthy delay.

Wonderful.

Hey, Merck, how about a little something for a flushed portfolio?

Worst
But our winner is former Stock Advisor selection LCA-Vision, which reported an awful 37% decline in first-quarter earnings. Free-falling operating margins -- down more than 650 basis points year-over-year -- were a big part of the problem.

Management, for its part, blamed lower volume even as they said the company earned more per procedure. Nice. Trouble is, the numbers appear to contradict management's claim. Gross margin declined to 50.4% from 51.1% in last year's Q1.

Incongruities such as this don't inspire faith. For Fool co-founder David Gardner, it's one of the principal reasons he recommended a sale in November. "It also doesn't help that the LCA management team is struggling to react to current conditions while preparing for the future," he wrote. "And while we're talking about the future, I should mention that I'm not convinced that management can create the type of growth I envision for us at Stock Advisor."

Talk about prescient.

LCA-Vision and its blind-to-growth executive team ... Tuesday's Worst Stock in the CAPS world.

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