Stupidity is contagious. It gets us all from time to time. Even respectable companies can catch it. As I do every week, let's take a look at five dumb financial events this week that may make your head spin.
1. Don't have a Macau, dude
The Securities and Exchange Commission and Department of Justice are looking into accusations that Las Vegas Sands
The very whiff of the allegations were enough to send shares of Las Vegas Sands down 6% Tuesday -- on its heaviest trading volume of the year.
Will the investigations bear fruit? Should corruption and ethics be defined on a country-by-country basis? All that matters at the moment is uncertainty, and that's the kind of cloud that can keep a stock in check.
It's a shame because Las Vegas Sands is rolling these days. Macau is a juicy hotbed of potential growth, and investors are seeing that in Las Vegas Sands and Wynn Resorts
Las Vegas Sands blew past Wall Street's profit targets every quarter last year. Analysts see the casino operator growing revenue and earnings this year by 28% and 82%, respectively. In retrospect, today's uncertainty may be a buying opportunity, but it may be best to wait until the SEC and DOJ stop gnawing on Las Vegas Sands.
2. Tiers of a clown
Well, that smorgasbord didn't last long.
Now Verizon CFO Fran Shammo is pointing to a "mid-summer timeframe" for nixing its $30 a month unlimited data plans and following AT&T into offering only scaled-back pricing tiers.
Did Verizon iPhone owners just fall for a bait-and-switch scam? No. AT&T grandfathered in those still on unlimited data plans, and Verizon is likely to follow suit. However, in a push to smoke out new iPhone owners, Verizon is losing a key differentiator relative to AT&T.
3. Pop goes the world
Another problematic hiccup for the seller of home carbonation systems is that it sold fewer CO2 carbonators during the fourth quarter than it did in the third quarter. These are the cylinders that need to be replaced after dozens of bottles of water are quickly transformed into seltzer.
Are folks using them less?
Well, here is where Wall Street may have it wrong. It's true that SodaStream sold just 2.5 million CO2 carbonators after moving 2.6 million of them the previous quarter. However, soft drinks are a seasonal beverage, especially in SodaStream's flagship European market. Folks go through more soft drinks during the hot summer months than the cooler fourth quarter. Looking back at 2009, SodaStream sold 2.1 million CO2 carbonators in both the third and fourth quarters. There wasn't any sequential growth last year, either.
Let's see how this story plays out, especially now that initial system sales are taking off here stateside.
4. Rosetta stoned
Language software giant Rosetta Stone
Rosetta Stone put out a crummy quarterly report. Revenue fell 5%, and earnings plunged by a steeper than expected 59%. An 11% decline in domestic orders is at the heart of the top-line miss, but could Rosetta Stone be pricing itself out of the market?
The average price for one of Rosetta Stone's software packages has risen 14% over the past year. How prudent is it to raise prices when orders are dropping? Rosetta Stone sees continuing weakness domestically this year, though it's banking on growth overseas.
The upside here is that Rosetta Stone is backed by a cash-rich balance sheet. It may also smoke out value investors now that it's fetching far less than its $18 IPO price. However, it's hard to get too excited when it's targeting a 25% to 30% decline in domestic sales for the current quarter.
5. Death by hashtag
It's been soliciting Twitter and Facebook reviews on its new poultry lines, and it even armed its customers with the #DPZChicken hashtag to tweet about their initial impressions. Domino's is promoting the hashtag in its delivery boxes and even on the landing page of its website.
The problem? Too many people think that the new chicken isn't all that great. Domino's was able to embrace a snapshot of a smashed pizza box and turn it into an ad campaign. I'm not sure how it's going to spin the Twitter feed where roughly half of the comments are negative.
Which of these five moves do you think is the dumbest? Share your thoughts in the comment box below.
Rosetta Stone is a Motley Fool Stock Advisor recommendation. The Fool owns shares of Domino's Pizza. 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.
Longtime Fool contributor Rick Munarriz is a fan of dumb and smart business moves. Investors can learn plenty from both. He does not own shares in any of the stocks in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.