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. Seas get rougher at SeaWorld
SeaWorld (SEAS -0.31%) continues to lose musical acts in light of the scathing Blackfish documentary that knocks the practice of keeping killer whales in captivity. Martina McBride and .38 Special became the latest recording stars to bow out of the marine life theme park's music festival.
SeaWorld was already struggling to grow its attendance this year before the documentary inspired activist groups to lobby musicians to cancel shows. Just last week, Blackfish became freely available on Netflix, the country's leading video service, resulting in broader awareness of the perils of training killer whales.
SeaWorld is striking back this morning with an open-letter response appearing in several newspapers across the country to tell its side of the story. However, it's hard to shift public opinion.
2. Ford tough
Ford (F -1.19%) has been delivering good news for years, so it may have come as a surprise when the leading automaker posted a poorly received business update. Ford warned that the European recession and currency devaluations in Venezuela will sting sales in the near term.
Its bottom line will also be dented by its most aggressive product rollout in more than a century. Ford has 23 new or refreshed vehicles hitting the market across the world next year, and that will keep operating margins in check.
3. The bull's-eye logo was pretty much asking for it
The hardest part of shopping is usually having to pay the bill, but millions of Target (TGT 0.57%) customers may have an even bigger problem this season. The cheap chic discounter revealed this week that hackers have stolen information from more than 40 million credit and debit cards during the first three weeks of the holiday shopping season.
Ouch! We're just starting to wrap up the crucial holiday shopping season, and now Target is giving shoppers a good reason to go elsewhere.
4. Rock lobster
Darden Restaurants (DRI 0.31%) continues to have problems at its two largest chains, and that's pretty bad, as Red Lobster and Olive Garden account for nearly 70% of its business.
Shares of Darden slipped after another quarter of negative same-restaurant sales at the two casual dining concepts. Things are so bad that Darden is now looking to unload Red Lobster by either spinning it off or outright selling it. Olive Garden is holding up only relatively better. Its comps continue to slip, and now Darden will be holding back on building new locations until it can turn that performance around.
Darden is being needled by an activist investor, who's insisting that it spin off both concepts to focus on smaller chains with more potential. However, the activist investor is also asking for Darden to cut costs more aggressively than it's already doing. Maybe it's just my uninspired gut talking, but cutting corners is probably the last thing that a restaurateur struggling to woo diners should be doing.
5. Blackberry picking season
The fall and fall of BlackBerry (BB 2.52%) continues. The smartphone pioneer continues to lose relevance after posting a dreadful quarterly report on Friday morning.
Revenue plunged 56% in its latest quarter, falling well short of Wall Street targets. Naturally, it also posted a much larger loss than the market was expecting. BlackBerry thankfully has a fat cash balance, but it's hard to get excited about a company that sold less than 2 million phones this past quarter. BlackBerry should've cashed out at the first whiff of iPhone and Android success. Waiting it out while its global market share contracts has been brutally painful for investors.
