This Week's 5 Dumbest Stock Moves

These five companies got it wrong this week.

May 23, 2014 at 5:17PM

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. Fore-gone conclusion 
Dick's Sporting Goods(NYSE:DKS) shares plunged 18% on Tuesday after the company hosed down its outlook. Negative trends in golf and hunting gear find the sporting goods retailer now targeting an adjusted profit of no more than $2.85 a share. Its earlier guidance was north of $3 a share. It also sees comps clocking in with growth of 1% to 3%, shy of its earlier call for growth of 3% to 4%.

It probably isn't a surprise to see that Dick's also fell short of its sales and earnings expectations for the first quarter. Did lousy weather keep golfers and hunters away, or is this a larger trend against these two sporting goods categories? Investors aren't sticking around to wait for the answer. 

2. Sha-moolah
It's going to cost a little more to head out to SeaWorld Entertainment's (NYSE:SEAS) Florida theme parks this summer. SeaWorld increased the price of a one-day ticket for Sea World Orlando or Busch Gardens Tampa by 3% to $95.

It may not seem like much of an increase, but is a day at either park really more valuable than EPCOT, Animal Kingdom, or Disney's Hollywood Studios, which cost a buck less? More importantly, SeaWorld's attendance declined 4% last year, falling 13% during this year's first quarter. Attendance has fallen for four consecutive quarters. A price hike isn't the solution. 

3. Chair the meeting
The past few years have been ripe with car, food, and toy recalls, but now we're seeing office chairs having to be called back after defects. Office Depot (NASDAQ:ODP) issued a recall on Thursday for 1.4 million Gibson Leather Task Chairs.

Office Depot has received at least 153 complaints of the task chair's plate weld cracking or breaking, and in 25 cases it has resulted in contusions, abrasions, and other injuries. You may have seen people fall from office chairs through their own clumsiness, but it can get scary when the chair's the problem.  

4. No one puts eBay in a corner -- unless it's a hacker
The latest big consumer name to get hacked is eBay (NASDAQ:EBAY). Hackers breached the online marketplace, obtaining access to information on eBay's 233 million customers. Financial info and passwords are encrypted, but the same can't be said about customer names, emails, addresses, phone numbers, and birthdays. 

Data breaches are happening way too often, but eBay makes the cut in this week's list because the hacking began three months ago, was detected two weeks ago, and wasn't announced to the public until Wednesday. In fact, as of late Thursday, eBay had yet to email its users. Folks simply receive the notice when they log on to the site suggesting that they change their passwords. That's bad form, eBay.

5. The HP weigh
Hewlett-Packard (NYSE:HPQ) is looking to get lean. The PC giant announced that it would be slashing thousands of jobs -- as many as 16,000 -- after posting a 1% decline in revenue. 

Layoffs are never fun, but HP's slightly lighter-than-expected sales weren't the only surprise. HP released its quarterly report six minutes before the market close on Thursday afternoon, forcing investors to scramble in forming an opinion. HP was supposed to put out its results after the market close. I'm starting to see why Dell decided that it was better to go private.

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Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends and owns shares of eBay. 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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