Will 2012's Losers Rebound in March?http://www.fool.com/investing/general/2012/03/01/will-2012s-losers-rebound-in-march.aspx Dan Caplinger
March 1, 2012
In a booming market, it's easy to find winning stocks. But even in the biggest bull markets, some stocks always lag behind. The question, then, inevitably becomes this: Are those stocks great values, or are they lagging for good reason?
Two months into the new year, short-term winners and losers have started sorting themselves out for 2012. So let's take a look at the five worst performers in the S&P 500 with an eye toward discovering what's behind their stock price declines -- and potentially unearthing some bargains in the process.
Apollo Group (Nasdaq: APOL ) , down 20.8%
Most of Apollo's plunge came just a couple of days ago, when it projected that new student enrollment rates would drop, reversing previous expectations for growth. For the stock's big drop to make sense, you have to believe that the current enrollment declines are just the tip of the iceberg -- and the beginning of a lasting trend that could eventually even threaten the industry's survival.
Electronic Arts (Nasdaq: EA ) , down 20.7%
What EA needs to do, however, is convince investors that social gaming isn't a threat to its more console-centered model. The popularity of Zynga has convinced many that lower-margin online games will eventually price EA and its peers out of the business. Yet despite recent weakness in the gaming industry, gamers will always reward good content -- and as long as EA delivers, it's likely to find ways to turn around its recent losses.
SUPERVALU (NYSE: SVU ) , down 18.5%
Yet for value investors, the long-term story remains the same. SUPERVALU is slowly but surely cutting its debt, and even with the weak margins throughout the grocery business, SUPERVALU trades at multiples that are just half of what competitors Kroger and Safeway sport.