The Week's Biggest Stock Laggards

On the bright side, it now seems almost assured that Greece will receive its next round of bailout funding and avoid a near-term, disorderly default. That's not to say that investors are settled about that heavily indebted country or the struggling eurozone as a whole, but it appears to at least be a step in the right direction. Meanwhile, in the United States, economic signals continue to be mixed, as January durable-goods orders posted a surprisingly large drop, while consumer confidence is showing some relative strength.

Throw that all together, and we ended up with a week where the S&P 500 index was up yet again but other indexes were stuck in neutral. The Dow Jones Industrial Average (INDEX: ^DJI  ) managed to close above the psychologically important 13,000 on Tuesday, but it couldn't hold on and ended the week roughly flat. The broader Russell 3000 had a similar experience -- posting gains during the week, but finishing out basically back where it started.

The 3 Worst-Performing Sectors

Russell 3000 Sector

Weekly Price Change

Month-to-Date Price Change

Energy (1.8%) (0.2%)
Industrials (1.2%) (0.4%)
Materials (1%) 0.5%

Source: S&P Capital IQ. Weekly price change is Feb. 24-March 2. Monthly price change is Feb. 29-March 2.

By all appearances, the fourth-quarter earnings release for Vocus (Nasdaq: VOCS  ) was deserving of cheers. Results topped analysts' expectations as non-GAAP earnings per share grew 26% from the prior year. Perhaps even better, the company's guidance for the upcoming year was basically in line with Wall Street's estimates. However, the company also told investors that it had acquired email-marketing software company iContact for $169 million in cash, stock, and convertible preferred stock. Not only is that a massive acquisition for a company of Vocus' size, but shareholders also may have thought it a high price for a company that's expected to reduce Vocus' 2012 earnings. Investors cut more than 40% off Vocus' stock price during the week.

Career Education (Nasdaq: CECO  ) didn't lose quite as much as Vocus, but the 31% that Mr. Market sliced off its stock price was nonetheless painful for shareholders. While the for-profit education company managed to top analysts' earnings estimates, its numbers still showed that the company is struggling to regain its footing after the government cracked down on recruiting practices at for-profit schools. Ominously, Career Education showed that new-student starts plunged 24% versus 2010.

The 3 Worst-Performing Russell 3000 Companies

Company

Weekly Price Change

Vocus (40.4%)
Career Education (31.3%)
Cabot Microelectronics (30.9%)

Source: S&P Capital IQ. Weekly price change is Feb. 24-March 2. Includes only companies with market caps of $250 million or more.

Also among the week's worst performers were Dendreon (Nasdaq: DNDN  ) and National Presto Industries (NYSE: NPK  ) . For Dendreon, its fourth-quarter results were softer than expected on the top line, which is bound to bring on some investor disappointment. However, as my fellow Fool Brian Orelli pointed out, the stock's plunge may have been driven more by the fact that management's guidance was sparse and relatively unimpressive, leaving investors with the impression that growth in the company's prostate-cancer drug may not live up to what they'd hoped. By week's end, Dendreon's stock had shed 25%.

Turning to National Presto, there's a good portion of the past week's drop that isn't bad news. Specifically, the company, which has been known in recent years for paying a hefty special dividend, went ex-dividend this week on a $1-per-share regular dividend and a $5 special dividend. Unfortunately for shareholders, the decline in the stock wasn't confined to that $6 tally. While there wasn't any news out specifically, what we may have seen were some investors sticking around for the dividend before bailing. The past year was a challenging one for the company, and its dividend was a good deal smaller than the prior year's, so some investors may have decided to move on.

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.

The Motley Fool owns shares of Dendreon and National Presto Industries. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Matt Koppenheffer owns shares of National Presto but has nofinancial interest in any of the other 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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