Why Did My Stock Just Die?

Your stock just took a nosedive -- but don't panic. First, let's see whether it had good reason to fall. Sometimes, panic-fueled drops can make excellent buying opportunities. Here's the latest crop of cratered stocks that could provide a possibility for profit:

Stock

CAPS Rating (out of 5)

Wednesday's Change

Oilsands Quest (NYSE: BQI  )

*****

(6.7%)

Siliconware Precision Industries (Nasdaq: SPIL  )

*****

(7.5%)

Sprint Nextel (NYSE: S  )

**

(9.9%)

From peak to trough, the market swung 186 points, though it ended the day down only 43, or less than a half percent. So, stocks that went down significantly more are big deals.

The devil's in the details
Not even rising oil prices have been able to help tar sands developer Oilsands Quest get out of the sticky situation it's found itself in. The brief respite it got after announcing it was "exploring strategic alternatives" has one resulted in another losing skein for its stock since no buyer has materialized. It tried to sell off assets piecemeal, but that deal collapsed, too.

Suncor Energy (NYSE: SU  ) , Canada's biggest integrated oil producer with both tar sands assets and conventional oil production, and Canadian Natural Resources have both been on a bit of a seesaw as well. Yet as oil settles reliably about $80 a barrel, the outlook for tar sands developers looks brighter as the oil becomes an increasingly important resource to tap.

Perhaps not for Oilsands Quest, though, since it says it's doubtful it can remain as a going concern if it doesn't get more financing soon. It wants to issue $12 million worth of new shares -- and as much as $15 million -- to help finance a 10 well winter drilling program. It was that news that apparently sent the stock tumbling.

Surprisingly, and despite the horrid finances Oilsands Quest sports, the CAPS community has an overwhelmingly favorable opinion of the oil developer. With over 1,000 members weighing in, almost 97% believe it will outperform the market, though it might be predicated on a buyer coming in and offering a premium to current prices.

There are certainly more financially stable tar sands developers out there, but only you can decide if Oilsands Quest is right for your portfolio. Add it to your My Watchlist page, where all the Foolish news and analysis about this stock is aggregated for you.

The sky's not the limit
The market was apparently shocked -- shocked! -- that Siliconware Precision Industries reported worse than expected earnings, which sent its shares down, too. But for those who had been looking (and I wasn't one of them), there were signs that might have warned you this was coming. Semiconductor-assembly equipment maker Kulicke & Soffa (Nasdaq: KLIC  ) , which was previously reporting strong demand from its customers, suddenly said fourth-quarter revenues would be "significantly below" those recorded in the third, meaning its customers were apparently cutting back.

It just so happens that along with Advanced Semiconductor Engineering (NYSE: ASX  ) , Siliconware is one of Kulicke's biggest customers, with both representing more than 13% of total revenues. Investor beware. Over the past week, Advanced Semiconductor's shares have jumped 7%, but earnings are due out tomorrow, and you might want to consider whether it will feel the same slap that Kulicke & Soffa and Siliconware did.

CAPS members, though, are hopeful that Siliconware will return to its market-thumping ways, and highly rated All-Star llgrout thinks it's in a fine position to grow. But let us know in the comments section below, or on the Siliconware Precision Industries CAPS page, how you feel the packaging and test services company will fare.

Push-to-balk
Was it benign neglect? Sprint Nextel did, after all, maintain Nextel's iDEN network at tremendous cost, but it has been described as a 2G technology in a 4G world. Now Sprint will be minimizing further how much it markets Nextel while promoting its CDMA technology. As it should be.

Sprint has sustained customer losses on the Nextel side of its business while becoming "net port positive" on the CDMA side for the first time. That means it gained more subscribers than it lost. In fact, Sprint added a total of 644,000 net wireless customers in the quarter.

But aside from customer acquisition, Sprint's earnings report was a big disappointment. Losses came in wider at $0.30 per share compared to the Street's $0.28 per share forecast. Compared to the excitement that surrounds Verizon (NYSE: VZ  ) , and even AT&T, Sprint Nextel comes across as a dullard.

With its fortunes seemingly resting on an iPhone coming to its doors, CAPS All-Star Jeffreyw is willing to be early with his call that it will be enough to resurrect Sprint. How about you? Tell us on the Sprint Nextel CAPS page if Sprint can really turn it around if it gets an iPhone.

Ready for a resurrection
Just because your stock has taken a beating doesn't mean it's going to roll over and die. Markets are known for overreacting. A closer look at what's happened to your stock can give you an edge over other investors who just react to the market's lead.

That's why it pays to start your own research on these stocks on Motley Fool CAPS, where you can read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made, all from the stock's CAPS page. Then you can decide for yourself whether it's ready to come back from the dead.

Sprint Nextel is a Motley Fool Inside Value recommendation. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Rich Duprey currently does not own any stocks as you can see here. The Motley Fool has a disclosure policy.


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