Barnes & Noble Shares Plunged: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Barnes & Noble (NYSE: BKS  ) fell 10% in early trading today before recovering most of their losses.

So what: The company posted a larger-than-expected loss during the fiscal second quarter of $0.22 versus the loss of $0.08 expected by analysts. The company spent heavily to develop the Nook reader, a product the company thinks can be a "massive opportunity."

Now what: As the world transitions away from physical books to e-reader devices, Barnes & Noble is having to contend with the likes of Amazon (Nasdaq: AMZN  ) and Apple (Nasdaq: AAPL  ) as formidable competitors. I have my doubts that Barnes & Noble can be more than a niche player in this market despite the strides Nook Color has taken since its launch. The losses in the quarter have done little to persuade me otherwise, so I'm selling the bounce late in the day today.

Interested in more info on Barnes & Noble? Add it to your watchlist.

Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

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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.

  • Report this Comment On November 30, 2010, at 6:06 PM, wsjreader wrote:

    Sorry, I don't know what the idiom "I'm selling the bounce late in the day today." means, given that the article footer says that the author, "Fool contributor Travis Hoium does not have a position in any company mentioned." What does the idiom "sell the bounce late in the day" mean, uttered by someone who doesn't own the stock?

  • Report this Comment On December 02, 2010, at 1:27 AM, rfaramir wrote:

    "so I'm selling the bounce late in the day today."

    I thought it could only mean that he either red-thumbed it in CAPS in the afternoon because of the bounce, or closed a green-thumb position on it in CAPS. Last I read them, Fool rules don't allow writers to end or initiate a position in any stock they write about 10 days before or afterwards.

    Unless things have changed, or those rules only apply to certain classes of TMF employees and not all writers. We'd like to know...

  • Report this Comment On December 02, 2010, at 1:27 AM, rfaramir wrote:

    Sorry, I meant to add: "but I checked his CAPS profile and there is no recent activity on BKS."

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