Why Citigroup, Accenture, and Windstream Corporation Are Today’s 3 Worst Stocks

Dividends, declining businesses, and the Fed's raw power over banks sent today's three worst stocks skidding

Mar 27, 2014 at 8:37PM

Although all three major U.S. indices lost ground on Thursday, the mood on Wall Street wasn't "bearish" by any means, and only 49% of publicly traded companies declined. While the overall losses were moderate by most standards, three poor performers still managed to lose investors gobs of money. Citigroup (NYSE:C), Accenture (NYSE:ACN), and Windstream Corporation (NASDAQ:WIN) all finished at the most abject depths of the S&P 500 Index (SNPINDEX:^GSPC) Thursday, as the benchmark lost just three points, or 0.2%, to end at 1,849.

Citigroup, which seems to go belly up and then get bailed out once every decade or two for good measure, lost 5.4% Thursday. It seems Uncle Sam's starting to catch on to Citigroup's eternally recurring moral hazard (Nietzsche meets Gekko, anyone?), and the Federal Reserve, for one, is sick of it. The Fed denied Citigroup's request to boost its dividend and go through with a $6 billion share buyback due to the bank's recent stress test, in which Citigroup failed to allocate for potential losses correctly.

Stock in consulting and IT company Accenture shed 5% today, and when you hear what's been amiss at the company, you'll want to sell it, too, even if you don't own shares. First of all, the company missed both revenue and earnings expectations in the most recent quarter. Then, Accenture dropped the bomb: Its pride and its joy, its bread and its butter, its sun and its moon -- the consulting business -- probably won't grow this year, and may even see a decline. Consulting brings in more than 50% of Accenture's revenue currently, and its consulting business has fallen in six of the last seven quarters. That part of its business is dying -- if you can't consult your clients into keeping you, either they don't need you, or your consulting isn't effective (or both). 

Finally, Windstream Holdings stock slumped 4.2% today. Shares of the telecom services company have been extremely stable in the last year, a stability that often comes with dividends as high as Windstream's. It dishes out nearly 12% annually to its shareholders, and four times a year, its stock stumbles when investors know they can get the next quarterly dividend and run with it. Today was one of those rare "ex-dividend" dates, where people cashing in on the $0.25 quarterly dividend sold the stock off to the tune of $0.25, or 3%, with the rest of the losses perhaps being due to worries about the high dividend, even though it looks sustainable for the time being.

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John Divine has no position in any stocks mentioned. The Motley Fool recommends Accenture. The Motley Fool owns shares of Citigroup. 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.

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.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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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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