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 (out of 5)

% Change

52-Week Range

AirTran Holdings (NYSE: AAI  )

$1.82

*

(16.89%)

$1.78-$11.17

R.H. Donnelley

$1.91

*

(21.40%)

$1.78-$78.10

Northwest Airlines (NYSE: NWA  )

$6.30

*

(15.66%)

$5.35-$22.74

Dillard's (NYSE: DDS  )

$9.81

*

(10.00%)

$9.72-$38.62

Red Robin Gourmet Burgers (Nasdaq: RRGB  )

$26.36

**

(11.81%)

$25.86-$44.50

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 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 our 110,000-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 Red Robin. On Wednesday, its executives told a gathering of investors that it expected same-store sales growth to come in close to the low end of guidance, or 2.5%.

Shocking.

Here's the problem: Consumers aren't interested how a corn shortage affects beef prices. They're more concerned about paying $10 -- or two-and-a-half gallons of gas -- for a burger.

Worser
Next up is Dillard's, which has the same problem -- only worse. Executives there say that the retailer suffered a 5% decline in same-store sales during June.

The report, issued this morning, follows from Morgan Stanley's (NYSE: MS  ) downgrade of the entire retail sector. Dillard's took a hit on the news, then followed with poor numbers, confirming the worst.

Well, the worst for now. At least one CAPS player envisions Dillard's falling all the way into bankruptcy court.

Worst
But our winner is AirTran Holdings, which earlier this week cut 480 jobs.

Much as I'm saddened by the human tragedy that follows these cuts -- and 2,500 similar cuts at Northwest -- AirTran makes our list because there's little hope that these layoffs will boost the business long-term.

Rewind to April with me. Back then, AirTran said it would issue $65 million in convertible debt and 14.3 million shares to keep from crashing. Higher altitudes in the way of earnings growth, management said, wouldn't be available before next year.

Now we know that AirTran's fundraising was insufficient. Anyone want to bet that growth has moved past the 2009 horizon?

AirTran Holdings ... bleeding fuel for earnings growth, 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.

Fool contributor Tim Beyers, ranked 18,980 out of more than 110,000 participants in CAPS, also writes for Rule Breakers. He hopes that Keith Olbermann doesn't mind the blatant theft of his "Worst Person in the World" segment from Countdown. Remember, Keith, imitation is the sincerest form of flattery.

Tim didn't own shares in any of the companies mentioned in this article at the time of publication. The Motley Fool's disclosure policy thinks that cooked spinach is the worst veggie in the world.


Read/Post Comments (0) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 682270, ~/Articles/ArticleHandler.aspx, 10/31/2014 7:42:08 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement