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. Two Rens don't make a right
The already rocky relationship between China's Renren
Losses continued, and revenue climbed 47% to $20.6 million. This might be acceptable for an unknown upstart, but not for a company valued in the billions.
Renren went public at $14 last month, rising as high as $24 on its first day of trading. The stock has gone on to give up half of its IPO price, or more than two-thirds of last month's high.
Revenue grew 64% last year, so the seemingly heady 47% top-line spurt this time around is actually a serious case of deceleration.
2. Nokia's orphan
There will often be debate on the potential success or failure of new smartphones, but you won't find too many N9 cheerleaders. The N9, after all, will be the first -- and likely only -- phone using the once-ballyhooed MeeGo operating system.
Nokia is accepting billions to champion Microsoft's
The folks investing in an N9 phone may very well be the same ones who paid up for Microsoft's short-lived Kin.
3. Earnings are for closers
The maker of capital equipment for the microelectronics industry sees itself earning $0.06 to $0.09 a share for the current quarter on $25 million to $30 million in revenue. The problem there is that the pros were targeting a profit of $0.12 a share on more than $32 million in revenue.
A miss and a diss is no way to end up with a kiss.
4. Achillion heel
Sometimes Mr. Market is the dummy.
Upstart biotech Achillion Pharmaceuticals
I get the sigh of relief. Achillion needed the money to move its potential blockbuster treatments for chronic hepatitis C along. The company was also able to float more shares than it had originally announced, going from 9 million on Monday to 9.6 million on Wednesday.
However, the cold hard truth is that this dilution took place at $5.90, a discount to where the shares were trading even before Wednesday's pop.
We're a few regulator nods away from the point where we would be quibbling between $5.90 and $7.26 price points, but it just feels as if Wednesday's euphoric reaction was way overdone.
5. A tree house falls in the woods
The maker of private-label food products is blaming the spike in commodity costs for crimping margins during the current quarter and for the entire year. It's naturally harder for a private label specialist to adjust prices than it is for premium brands, but we can't cut TreeHouse Foods a break here.
A miss is a miss.
Perhaps more importantly, this is the kind of news that may lead shareholders to wonder if consumers are bypassing store brands in favor of the name brands that they traded down from when the economy was falling apart.
Which of these five moves do you think is the dumbest? Share your thoughts in the comment box below.
The Motley Fool owns shares of Microsoft. Motley Fool newsletter services have recommended buying shares of and creating a diagonal call position on Microsoft. 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.
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.