The Dow's Biggest Losers Last Week

An in-depth look at what caused a few stocks to fall.

Jan 18, 2014 at 5:00PM

Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

Even without the release of any major economic data this past week, the major indexes had quite a volatile few days and ended the week mixed. Despite a 179-point drop on Monday and a smaller one on Thursday, the Dow Jones Industrial Average (DJINDICES:^DJI) finished the week higher by 21 points, or 0.13%, and now rests at 16,458.56 after starting the week at 16,437.05. The Nasdaq saw similar swings, but it managed to be the week's best performing index, gaining 22 points, or 0.54%. Meanwhile, the S&P 500 lost ground over the past five trading sessions, down 0.19% for the week.

Before we get to the Dow's biggest losers of the week, let's review its top performer. Visa (NYSE:V) gained 4.99% this past week, following a big gain on Friday after American Express reported better-than-expected results for the fourth quarter and a massive increase in customer spending. If the same spending trend holds true for Visa, it should see a huge boost in revenue and, more importantly, profits when it reports earnings on Jan. 30.  

Last week's big losers
Taking the third worst performing spot on the Dow this past week was Wal-Mart (NYSE:WMT), which lost 2.37% over the past five days, with the bulk of the decline coming on Thursday. That was the same day Best Buy said it experienced a 0.9% same-store-sales decline during the holiday shopping season, which could signal an industrywide slump. Wal-Mart also announced on Thursday that it had joined the initiative to require Florida tomato suppliers to increase farmer pay and provide workers with a safe working environment. It's hard to miss the irony here, as Wal-Mart stands firm against raising wages for its own employees, but the bigger issue for investors is that it may signal a sign of things to come. If Wal-Mart increases its workers' wages, corporate profits could suffer.  

The second worst performer on the Dow last week was UnitedHealth Group (NYSE:UNH), which fell 2.91%. The company reported an 18% year-over-year earnings increase, while revenue rose 8% as its membership base increased by 170,000. It was the company's forecast that worried investors, as management believes Medicare Advantage cuts in 2015 could cause weak earnings growth, if not negate earnings altogether. Despite the customer count increase, a result of the Affordable Care Act's individual mandate, UnitedHealth needs Medicare rates to remain strong if it wants to continue pumping out strong earnings growth, and it appears that may not always be the case in the coming years.  

Finally, the worst performing Dow component this week was Nike (NYSE:NKE), losing 4.58% following big declines on both Thursday and Friday. An analyst at Macquarie initiated coverage this week with a "neutral" rating and an $80 price target on the stock. That doesn't lend a whole lot of upside to the shares, which closed Friday at $73.39 and traded as high as $76.83 during the beginning of the week. That was really the only bad news on the week, so it's difficult to say what caused the massive sell-off, especially with the Olympics about to start. The Games are typically a good showcase for the athletic-apparel company.  

The other Dow losers this week:

  • Boeing, down 1.01%
  • Chevron, down 1.42%
  • ExxonMobil, down 1.35%
  • General Electric, down 1.4%
  • Goldman Sachs, down 1.18%
  • Home Depot, down 1.23%
  • JPMorgan Chase, down 0.65%
  • McDonald's, down 0.9%
  • Procter & Gamble, down 0.52%
  • Coca-Cola, down 2.11%
  • Travelers, down 0.85%
  • Walt Disney, down 1.87%

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Fool contributor Matt Thalman owns shares of Home Depot, JPMorgan Chase, and Walt Disney. Check back Monday through Friday as Matt explains what caused the big winners and losers of the day, and every Saturday for a weekly recap. Follow Matt on Twitter: @mthalman5513

The Motley Fool recommends American Express, Chevron, Coca-Cola, Goldman Sachs, Home Depot, McDonald's, Nike, Procter & Gamble, UnitedHealth Group, Visa, and Walt Disney and owns shares of Coca-Cola, General Electric, JPMorgan Chase, McDonald's, Nike, Visa, and Walt Disney. 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. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't 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.

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