This Week's 5 Dumbest Stock Moves

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Stupidity is contagious. It gets us all from time to time. Even respectable companies can catch it. As I do every week, let's take a look at five dumb financial events this week that may make your head spin.

1. The Diablo made me do it
Shares of Activision Blizzard (NASDAQ: ATVI  ) slipped on Thursday after the leading video game publisher revealed that it shed 1.3 million World of Warcraft players during the first quarter. There are now just 8.3 million subscribers, well off the 12-million player peak of three years ago.

Investors should've seen this coming.

Activision Blizzard offered players a tempting promo ahead of this past May's release of Diablo III. If they paid for a full year of World of Warcraft by March 13, 2012, they would receive the $60 PC game for free. Naturally, plenty of diehard gamers jumped on the offer, but as we eclipse the anniversary of that deal, it's also understandable why many of those same players have moved on.

2. Fleeing founders
There's a shakeup at Fusion-io (UNKNOWN: FIO.DL  ) , and the market doesn't like it.

Shares of the data storage company tumbled 19% on Wednesday after CEO David Flynn and CMO Rick White -- co-founders of the company -- abruptly stepped down. The co-founders will remain on the board for another year as they "pursue entrepreneurial investing activities," and, apparently, investors had warmed up to the two executives.

Fusion-io is trying to frame the move as a positive, with former HP exec Shane Robinson taking over; but wasn't he one of the guys spearheading the Autonomy acquisition that eventually forced HP into an $8.8 billion write-off?

It may be an unfair knock, but clearly the market didn't like the shift to more-seasoned tech leadership.

3. Office jerk
(NASDAQ: MSFT  ) may have too high an opinion of its Office suite of productivity software.

Bill Gates was on CNBC on Monday, waxing on the shortcomings of iOS and Android tablets. He argues that the iPad is a frustrating device because -- among other things -- users can't run Microsoft's own Office.

Well, let's see. Microsoft's solution hasn't been to put out Office for rival platforms, and it was hoping that last year's arrival of Windows 8 and Windows RT would make a dent in the market as the operating system that could run Office programs natively.

How has that panned out for Mr. Softy? Industry tracker IDC reports that Windows tablets accounted for just 1.8 million of the 49.2 million tablets shipped during the first three months of the year. You can't break 4% of the market on the premise that rival tablets are frustrating? That must be frustrating.

4. Monster mash
Just say "No" to energy drinks, kids.

San Francisco's city attorney is suing Monster Beverage (NASDAQ: MNST  ) , alleging that the country's leading seller of energy beverages (by volume) is marketing its caffeinated beverages to children and young teens.

The claims are debatable, but something that happened shortly after the lawsuit was filed doesn't bode well for Monster. Wrigley has decided to halt production of Alert, the chewing gum that was supposed to provide an adrenaline kick by packing 40 milligrams of caffeine. A can of Monster Energy contains several times that amount.

Don't rest easy, baristas serving invitingly sweetened chilled coffee drinks. You're next.

5. LivePerson turns into a zombie
LivePerson (NASDAQ: LPSN  ) shares plunged 36% on Thursday after hosing down its guidance for 2013.

The provider of online customer support tech solutions warned that weakness in Europe and losing a major client will result in lower financial results this year. LivePerson now expects to earn no more than $0.21 a share on $174 million to $179 million in revenue. Analysts were expecting net income of $0.32 a share on $183.8 million in revenue.

Shareholders have every right to complain -- but would they do it to a LivePerson rep online?

Get smart
You may have followed some losers this week, but there's always time to get it right the next time.

With so much of the financial industry getting bad press these days, it may be a greedy-when-others-are-fearful moment. Not surprisingly, some of Warren Buffett's biggest investments are in the space. In the Motley Fool's free report, The Stocks Only the Smartest Investors Are Buying, you can learn about a small, under-the-radar bank that's too tiny for Buffett's billions. Too bad, because it has better operating metrics than his favorites. Just click here to keep reading.

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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 May 18, 2013, at 10:04 AM, rsinj wrote:

    "Well, let's see. Microsoft's solution hasn't been to put out Office for rival platforms, and it was hoping that last year's arrival of Windows 8 and Windows RT would make a dent in the market as the operating system that could run Office programs natively."

    Clearly you do not have an understanding of the deep/long history of MS Office and Apple.

    Before spouting off, maybe you should go and do a bit of history research first and understand why Gates might make such a comment.

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