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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. Lost in translation
Some promotions are just doomed from the start. Coca-Cola (NYSE: KO ) may have thought that it had a clever marketing stunt for its vitaminwater in Canada, pairing up a random English word with another one in French.
Well, that was before someone uncapped a bottle of the vitamin-stoked beverage to find "YOU RETARD" scribbled on the back of the cap.
It wasn't supposed to be offensive. Retard, in French, simply means late or delayed. However, the random pairing of the two words finds the beverage giant wondering how all of the combinations weren't vetted beforehand. I guess one can say that it was Coca-Cola that was late on this one.
The home furnishings retailer blames weak ad spending for the light sales, but that doesn't explain the shortfall on the bottom line. It then tried to make up for the soft traffic in July by discounting aggressively in August, but that doesn't explain the softer-than-expected sales growth.
Pier 1 is upbeat about its prospects over the holidays, but that doesn't explain the softer outlook.
When things don't add up stock prices fall.
3. Hello Larry
There was a prominent no-show at Oracle's (NYSE: ORCL ) earnings call this week. CEO Larry Ellison wasn't there to tackle the hard questions, or take shots at the competition.
"Larry isn't with us today because he is at an important race for the America's Cup," Oracle's CFO explained.
CEOs have had spotty attendance at earnings calls in recent years, but it would have been good to have one around this time. Oracle missed revenue estimates, and the enterprise software giant's outlook wasn't very comforting.
At least one analyst took Oracle to task for not making the presentation.
"The call reflected a certain lack of direction, in our opinion, highlighted by CEO Larry Ellison's decision to skip the call to attend Races 11 and 12 of the America's Cup," laments JMP Securities analyst Pat Walravens.
4. Qihoo's your daddy?
Qihoo 360 (UNKNOWN: QIHU.DL ) has to be kicking itself. The company behind the fast-growing search engine was rumored to be in talks to acquire Sogou, China's third largest platform. Qihoo would have combined for nearly a quarter of China's search market with the deal, making it a more viable player in the most lucrative online niche.
Well, those plans are on ice now that Internet gaming and chat giant Tencent has stepped in to invest $448 million for a 36.5% stake in Sogou that it can eventually build up to a 40% position.
Qihoo 360 had a chance to be more than a thorn in the side of the market leader, but now it will have to settle for that -- and that's if Tencent's exposure doesn't help Sogou grow at Qihoo 360's expense.
5. There's an app for that
Today's the day for Apple (NASDAQ: AAPL ) , but the consumer tech giant doesn't make the cut in this week's list because of the weak preorders in China, or the lock screen hack that's already been unearthed.
No, Apple makes the cut here because of the market's misplaced expectations.
Shares of Apple moved lower earlier in the week when it failed to disclose iPhone 5c preorders. Apple has historically announced the metric after the initial weekend. However, faulting Apple here isn't fair. Unlike previous preorder cycles, Apple isn't making the new iPhone 5s available to order ahead of time, so it's just as if Apple would have only made the iPhone 4S available as a preorder a year ago when the iPhone 5 came out.
The comparisons would have been incomplete. Apple didn't get this wrong. Wall Street, and the financial media, are the ones making the dumb move.
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