Why Akamai Technologies, Whole Foods Market, and MasterCard Incorporated Are Today's 3 Worst Stocks

Most stocks advanced on Tuesday, reversing the bearish trend of the last several days, a trend driven by worry over high-growth stocks and biotechnology companies. But with consumer confidence hitting six-year highs this month, investors couldn't keep selling, and all three major indexes rose. There were some notable exceptions to today's bullishness: Akamai Technologies (NASDAQ: AKAM  ) , Whole Foods Market (NASDAQ: WFM  ) , and MasterCard Incorporated (NYSE: MA  ) all ended toward the bottom of the S&P 500 Index (SNPINDEX: ^GSPC  ) as it tacked on 8 points, or 0.4%, to finish at 1,865. 

Akamai Technologies, which offers cloud-based content management solutions, lost 2.9% on Tuesday. The company teamed up with Telefonica today to form a global business alliance aimed at offering telecom solutions and content delivery to enterprises. Today's drop is somewhat puzzling, and considering Akamai hasn't posted declining revenue or net income in the past four years, it's a "Steady Eddie" in an industry that won't be slowing down anytime soon. 

Whole Foods' wares. Source: Flickr

Shares of Whole Foods Market shed 2.8% Tuesday, although it also lacked a definite catalyst to blame for its decline. But it doesn't take a financial Sherlock Holmes to notice when sales and income growth start to decelerate quickly, and that's precisely what's happening with Whole Foods. Revenue grew at a 33% slower pace in 2013 than it did in 2012; net income growth nearly halved -- going from about 36% a year to about 18% a year -- in the same period. People want to eat healthy, but they also want to be able to afford a table to eat on. As health foods make a resurgence, Whole Foods and its absurd margins will have to suffer as a result.

Finally, MasterCard dropped 2.7% today, as financials were one of only two sectors to finish the day in the red. MasterCard's global presence as a payment option has made it the enormous $90 billion corporate titan it is today. But the company could lose an important part of its international business -- unless significant geopolitical changes come out of the blue -- and soon. Mastercard has been forced by sanctions on Russia to stop processing transactions with some Russian banks, a move that may inspire the country to ban foreign payment systems completely. 


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  • Report this Comment On March 25, 2014, at 8:46 PM, lplotsky wrote:

    Quote- "People want to eat healthy, but they also want to be able to afford a table to eat on. As health foods make a resurgence, Whole Foods and its absurd margins will have to suffer as a result."

    I am unaccustomed to this style of writing and bias in such financial writing and especially from a Foolish writer!!! This shows such disdain and bias- it looks like a typical Seeking Alpha opinion article more than the wonderful Fool news article it was masked as!

    I know, I know, when somebody says Starbucks- you say you get your coffee at the C-store,

    when somebody says Target- you shop at Big Lots and Dollar stores then Walmart when feeling good, and

    when somebody says Panera, you only eat wings with spicy junk on them-

    We see you and wish we hadnt!!!

  • Report this Comment On March 26, 2014, at 8:51 AM, davidsternberg wrote:

    "People want to eat healthy, but they also want to be able to afford a table to eat on." The talking heads and SA authors all told us of WFM demise back during the great recession. WFM dropped to the single digits from the 40s on that stupid talk. WFM proved them all wrong. Now you are suggesting the same thing. You try to pin a reason on a 2.8% drop in day. That is just silly. A new Whole Foods is opening up in the next town over and its all my neighbors and friends are talking about. These people are not rich or even upper middle class but they are all going to drive the 30 minutes to this store while there is a ShopRite and an A&P less than 10 minutes away. If WFM goes up 2.8% today what will you say that caused that?

  • Report this Comment On March 26, 2014, at 10:18 AM, sloopguy wrote:

    The item regarding WFM was very biased, to the extent the author had a vested interest in walking the stock down. It was even snotty. Sad to see that the author never ran this by someone who would have immediately brought him back to reality.

  • Report this Comment On March 27, 2014, at 9:06 PM, chrismcv wrote:

    The Whole Foods in our neighborhood has just celebrated their 7th year anniversary and remodeled part of the store adding a new fresh cooking station and bulk spices. It looks great!

    They have even acknowledged lower prices throughout the store and run weekender and "One Day Deals" on a variety of items at great prices. We picked up some great tasting strip steaks just last week that were delicious (and a great price!).

    Sure, I buy some things at Target (like health and beauty items) but I won't step foot near a Wal-Mart (and, no, I am not wealthy) but you just have to shop the sales - and Whole Foods has lots of great bargains on quality items if you make the effort to find them.

    Whole Foods 1/2 gallons and gallons of milk are actually CHEAPER than Target or the other chain grocery stores in the area. Same with their own brand of multi-grain sliced bread.

    If you want to buy garbage go to Wal-Mart. If you want fresh and quality shop at Whole Foods or Costco. What else can I say?

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