The Week's Biggest Stock Laggards

In a yawn-inducing finish, 2011 closed out almost exactly flat with where it started. With such a low hurdle, it was easy for a positive start in 2012 to leave investors with a better gain in the first week of the year than they got from all of last year. The week-one gains didn't come without positive economic news, including a better-than-expected jobs report that showed 200,000 payroll additions and dragged the unemployment rate down to 8.5%.

The Dow Jones Industrial Average (INDEX: ^DJI  ) gained 1.2% for the week, while the broader Russell 3000 climbed 1.6%. Most sectors rode along with the broad indexes' gains, but a few sectors missed out on the New Year's celebration as investors fled more defensive stocks.

The 3 Worst-Performing Sectors

Russell 3000 Sector

Weekly Price Change

Month-to-Date Price Change

Utilities (2.5%) (2.5%)
Telecom (2.3%) (2.3%)
Consumer Staples (1%) (1%)

Source: S&P Capital IQ. Weekly price change is Dec. 30-Jan. 6. Monthly price change is Dec. 30-Jan. 6.

Is Eastman Kodak (NYSE: EK  ) a buggy-whip company that's on the cusp of disappearing into the cold clutches of Chapter 11 bankruptcy? If the stock market has anything to say about it, the answer seems to be a pretty clear "yes." Mr. Market didn't get that idea without reason -- it emerged this week that Kodak has been making preparations for a bankruptcy filing. To be sure, it's not a done deal, but with Kodak valued at just over $100 million and its stock changing hands at a mere $0.37, the best-case scenario is that we're looking at a company that's barely a shadow of what it once was.

Bookseller Barnes & Noble (NYSE: BKS  ) may not be knocking on death's door -- even if its key competitor, Borders, slid into liquidation -- but it was a messy week for investors nonetheless. B&N revealed to investors that the company's fourth quarter is going to look a lot worse than expected. Lower-than-anticipated sales of entry-level Nooks, along with higher-than-expected promotional costs, squeezed profits in the final quarter of the year. Maybe even more surprising, the company announced that it's thinking about spinning off the entire Nook division.

The 10 Worst-Performing Russell 3000 Companies

Company

Weekly Price Change

Eastman Kodak (42.7%)
DURECT (37.7%)
BioMimetic Therapeutics (29.8%)
Barnes & Noble (22.7%)
Dialogic (21.7%)
Integra LifeSciences (Nasdaq: IART  ) (20.6%)
Bon-Ton Stores (19.6%)
AVEO Pharmaceuticals (Nasdaq: AVEO  ) (18.8%)
Angie's List (17.8%)
Vical (17.5%)

Source: S&P Capital IQ. Weekly price change is Dec. 30-Jan. 6.

Also among the week's worst performers were Integra LifeSciences and AVEO Pharmaceuticals. Between late October and last week, Integra investors have now endured two episodes of forecast cutting from the company's management. In dropping full-year earnings-per-share expectations from a range of $2.88 to $2.96 to a range of $2.74 to $2.79, management's adjustment was really more of a tweak than a slash, but don't tell that to investors. Antsy shareholders made a mad dash for the exits after the announcement, leaving the stock down more than 20% for the week.

AVEO, meanwhile, had a bout of adjusting expectations of its own during the week. While not specifically financial -- a late-stage trial of the company's kidney-cancer drug didn't show nearly the advantage over competition as was expected -- the news has the potential to lead to very real financial consequences in the future. Many investors declined to stick around to find out how the long term will play out, and the stock fell nearly 19% for the week.

That's it for the weekly laggards recap. Looking to turn the tides and find some strong outperformers in the year ahead? The Motley Fool has created a brand new free report titled "The Motley Fool's Top Stock for 2012." In it, my fellow Fools reveal a top pick that's poised for explosive growth ahead. Get instant access -- it's free.

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Fool contributor Matt Koppenheffer has no financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter, @KoppTheFool, or on Facebook. The Fool's disclosure policy prefers dividends over a sharp stick in the eye.


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  • Report this Comment On January 08, 2012, at 5:04 PM, trysson wrote:

    Lower than expected sales of entry-level-nooks should be expected because nook-color is well worth the wait. I just received my nook color and am very impressed. Hooked up to my home wifi, took my AE Card, took my password and access code, and let me buy from (of all places) Amazon in less than 120 seconds. Nothing electronic has ever been easier for this 65 year old fool. Great product. trysson@aol.com. Trysson owns no B&N or Amazon stock.

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