This Week's 5 Dumbest Stock Moves

Here are five companies that got it wrong this week.

Jan 3, 2014 at 5:15PM

Stupidity is contagious -- even respectable companies can catch it. As we do every week, let's take a look at five dumb financial events this week that may make your head spin.

1. Target practice
Target (NYSE:TGT) shoppers who may have dodged a bullet this holiday shopping season by not having their credit or debit card information exposed to hackers may still have to deal with angry gift recipients.

The discount department store chain revealed on Tuesday that less than 0.1% of the gift cards sold this season were not properly activated. Recipients of the cards are encouraged to check that they have a positive balance by calling the toll-free number on the back of the cards. Target will still honor the inactive cards that were sold.

That's a good thing, because it would be pretty embarrassing if one of every thousand cards sold were denied at the register, leading the recipient to think their friend or family member had cheated them out of a present.

It was going to be hard enough for Target to win back consumer confidence after the data breach, but now it could be even harder.

2. Sony may crack open Windows
(NYSE:SNE) may have a Windows Phone in the works, according to The Information. This would be a surprise for a couple of major reasons. The first, naturally, is that Windows Phones haven't been selling well outside of some Lumia models. Handset manufacturers have largely avoided paying Microsoft (NASDAQ: MSFT) directly for Windows, preferring to pay Mr. Softy indirectly by going through the global standard Android open source platform.

The second reason why this seems like a dumb move -- if true -- is that Sony's duking it out with Microsoft in the video game console market with the November rollouts of the PS4 and Xbox One. Why would Sony validate Microsoft? The smartphone could be out as soon as the middle of this year.

3. Netflix plays it cheap
(NASDAQ:NFLX) was a candidate for this week's column after a lot of popular movies and TV shows were booted from the service's digital catalog this week, but that's going to happen. Netflix signs new deals and lets others lapse.

However, Netflix cemented a slot here by offering some new users the option of a $6.99-per-month account. It only allows one user to stream at a time (unlike the $7.99-a-month plan that allows two family members to stream simultaneously), and it's only standard definition. This company has concerned investors in the past with its inability to increase average revenue per user, and now along comes a product that's even cheaper.

This may be good news for singles who don't have the bandwidth for high-def streaming, but why blur the value proposition at the expense of average revenue per user?

4. Hertz so good
(NYSE:HTZ) shares rose 10% on Tuesday after the company wheeled out a poison pill. The auto rental giant -- sensing unusual trading activity in its shares -- is going with a shareholder rights plan to prevent a hostile takeover.

I'm no fan of poison pills, and this is another example of why the market often gets it wrong by pushing these companies higher. The stock rose on the notion that someone may be interested in taking a controlling stake in Hertz, but the rental chain's move indicates that it will make things hard on any potential buyer. 

The rental market has been consolidating for years, and that will likely force any potential interested party to snap up a different player. Playing hard to get may work at the high-school dating level, but not at a corporate sock hop. 

5. Out of touch
You know it's bad when your CEO resigns to "pursue other interests," but the situation at UniPixel (NASDAQ:UNXL) got even worse 24 hours later when the COO also decided to bail on the company.

UniPixel offers touchscreen solutions for consumer and industrial applications, but the actions of two key execs just hours apart make it seem like it's out of touch.

Bounce back with three companies doing it right
It's no secret that investors tend to be impatient with the market, but the best investment strategy is to buy shares in solid businesses and keep them for the long term. In the special free report, "3 Stocks That Will Help You Retire Rich," The Motley Fool shares investment ideas and strategies that could help you build wealth for years to come. Click here to grab your free copy today.

Longtime Fool contributor Rick Munarriz owns shares of Netflix. The Motley Fool recommends Netflix. The Motley Fool owns shares of Hertz Global Holdings, Microsoft, and Netflix. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.

Compare Brokers