Why Weyerhaeuser, Tesoro Corporation, and Cabot Oil & Gas Are Today's 3 Worst Stocks

From the real estate market to mainstays in the energy business, these 3 stocks tumbled in the market today

Mar 17, 2014 at 7:29PM

About two in every three stocks advanced in the stock market today, as investors cheered impressive U.S. industrial productivity in February. While February's 0.8% month-over-month uptick may not seem like much, it was the highest such advance in six months, and renewed confidence in the American auto industry in particular. Despite the rampant bullishness, every day has its losers, and Weyerhaeuser (NYSE:WY), Tesoro Corporation (NYSE:TSO), and Cabot Oil & Gas (NYSE:COG) finished at the bottom of the S&P 500 Index (SNPINDEX:^GSPC). By day's end, the S&P was up 17 points, or 1%, to finish at 1,858. 

Shares of Weyerhaeuser, a vertically integrated home builder and lumber supplier, lost 1.8% on Monday. Investors weren't too happy that U.S. manufacturing numbers did so well while the prospects for real estate disappointed. After a record-setting decline in the housing market index in February, the gauge hovered around its disappointing levels, going from 46 to 47. Numbers above 50 indicate that builders think the housing market is improving. Weyerhaeuser, which is both directly and indirectly reliant on real estate as a home builder and materials supplier, didn't take kindly to the news.

Oil refiner Tesoro Corporation shed 1.7% Monday, despite a lack of company-specific news. Refiners like Tesoro (and Cabot Oil & Gas, for that matter) rake in more proverbial dough when oil prices are falling. Refiners buy crude oil and, well, refine it, creating a cleaner and more desirable energy source for consumers. For Tesoro and its peers, the price of these refined products (like gasoline) don't swing as quickly as crude oil prices. This creates both a strength and a weakness, since falling oil prices will take some time to convert to lower prices at the pump, while higher oil prices won't translate immediately either.

It's interesting that Cabot Oil & Gas (NYSE:COG) should also find itself on this list, with its stock falling 1.7% Monday. Oil prices slipped today, approaching $98 a gallon, a trend that should ultimately be good for refiners and their margins. Ultimately the future of Cabot Oil & Gas, like Tesoro's future, is largely slave to the Brent-WTI spread, which is the price difference between similar types of oil in the U.S. and Europe. The larger this spread is, the more refiners stand to profit. The Brent-WTI spread has narrowed significantly in the past year, cratering nearly 60% over that period and crushing refiners' margins. The silver lining, of course, is that refiners stand to post big gains if the margins expand again, although that's a big if, and hardly an investible thesis.

Is Uncle Sam about to claim 40% of your hard-earned assets?
Thanks to a 2013 law called the American Taxpayer Relief Act, or ATRA, he can, and will, if you aren't properly prepared.

Fortunately, The Motley Fool recently uncovered an arsenal of little-known loopholes to protect yourself from ATRA and help keep the taxman at bay when he inevitably comes calling. We reveal them all in a brand-new special report. Simply click the following link for instant, 100% free access.

Protect my hard-earned wealth from Uncle Sam

John Divine has no position in any stocks mentioned. You can follow him on Twitter, @divinebizkid, and on Motley Fool CAPS, @TMFDivine.

The Motley Fool has no position in any of the stocks mentioned. 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.

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 fool.com.

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 www.fool.com/beginners, 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 www.fool.com/podcasts.

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