Bad days. We all have them; some of us deserve them.

Here are five stocks whose naughty ways drew investors' scorn on Monday.


Closing Price

CAPS Rating (out of 5)

% Change

52-Week Range

Franklin Bank (NASDAQ:FBTX)





Medivation (NASDAQ:MDVN)





Toreador Resources (NASDAQ:TRGL)





E*Trade Financial (NASDAQ:ETFC)





Countrywide Financial (NYSE:CFC)





Sources: The Wall Street Journal, Yahoo! Finance, Motley Fool CAPS.

Well, OK, we can't exactly call these stocks naughty. But none of them get much love from our 75,000-person-strong Motley Fool CAPS community of amateur and professional stock pickers.

To the contrary -- when it comes to these stocks, CAPS investors have gone thumbs-down more often than film critic Roger Ebert. They believe that none of these stocks are worth owning, and that some may be worth shorting.

Which of today's candidates is worst? Read on, dear Fool.

We begin with Franklin Bank, which on Monday admitted that it would have to more than double its loan reserves, from 0.42% to 0.91% of its portfolio.

But this is happening with lots of banks, including former winner Downey Financial (NYSE:DSL). Why is Franklin different? Make sure you read all the way through the press release, Fool. Here's what you'll find at the end:

Franklin discovered that four loans related to one borrower totaling $13.5 million should have been categorized in the third quarter Form 10Q as troubled debt restructurings. [Emphasis added.]

One borrower ... four loans ... $13.5 million. Gone.

Um, guys? Anyone over at Franklin ever heard of due diligence?

Next up is Medivation, which took a hit after an analyst initiated coverage of the stock with a sell rating and -- get this -- a $5 price target, or roughly 66% lower than yesterday's close.

Talk about a brave call.

But is there really enough to go short on this emerging biotech? A history of capital destruction says yes:

Return on Capital

Trailing 12 Months







Source: Capital IQ, a division of Standard & Poor's.

Others simply see a nonsensical valuation. Here's how CAPS investor zzlangerhans put it in July:

Market cap currently overinflated based on positive phase II data for Dimebon. Alzheimer's, like cancer, has been a very difficult player to beat in phase III regardless of phase II performance. Stock price may bump short term on noise about phase III trial for Dimebon, but I expect downward trail within a year due to lack of new positive data and absence of other advanced compounds in pipeline.

The stock is down more than 25% since he made that call.

But our winner is, once again, Countrywide Financial. Why? The Wall Street Journal outed the bank for borrowing more than $50 billion from the Federal Home Loan Bank in Atlanta. A quasi-governmental institution, the FHLB was designed during the Depression era to prop up local banks, the Journal reports.

Now, apparently, these same banks -- or at least one branch of the network -- are being used to circumvent the credit markets, which, in theory, could circumvent the necessary process of repricing the risk associated with writing stupid loans. (At least Citigroup (NYSE:C) will pay 11% on its $7.5 billion bailout.)

But it gets worse. According to the Journal, the FHLB in Atlanta is one of 12 banks in a federally funded codependent network. Each bank is responsible for the FHLB's obligations.

That could become important. Here's why: Countrywide's rapidly degrading mortgage portfolio, put up as collateral, now accounts for roughly one-quarter of the $190.72 billion in assets that the FHLB branch in Atlanta holds.

See where I'm headed with this? Thanks to the FHLB and Countrywide, taxpayers face an even greater risk from the credit crunch than they did just a few months ago. Nothing new there, eh?

Countrywide and its how-about-we-let-the-taxpayers-bail-us-out management team ...  Monday's worst stock in the CAPS world.

Do you agree? Disagree? Let us know what you think by signing up for CAPS today. It's 100% free to participate.

See you back here tomorrow for more stock horror stories.

Fool contributor Tim Beyers, who is ranked 9,777 out of more than 75,000 participants in CAPS, hopes that Keith Olbermann doesn't mind the blatant theft of his "Worst Person in the World" segment from Countdown. Remember, Keith, imitation is the sincerest form of flattery.

Tim didn't own shares in any of the stocks mentioned in this article at the time of publication. Find Tim's portfolio here and his latest blog commentary here. The Motley Fool's disclosure policy thinks that cooked spinach is the worst veggie in the world.