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Today's 3 Worst Stocks

By John Divine - Apr 8, 2013 at 7:06PM

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Beware the gravity behind these "falling knives" on Monday.

Despite calls for slowing growth by some economists, the market just couldn't help itself today. After posting its worst week of the year last week, the S&P 500 Index (^GSPC 2.39%) bounced back today ahead of earnings season's unofficial kickoff this afternoon. Although some estimates put earnings growth at 1.6% this quarter, others have S&P 500 company profits declining by nearly 2%. We'll see how it plays out, but what's certain today is that the following three stocks simply couldn't keep up with their peers.

There's an old Wall Street saying: "Never try to catch a falling knife." While I also try to heed that advice on a day-to-day basis, bearish momentum sure can develop some killer inertia in the stock market. Few investors know this better than Apollo Group (APOL) shareholders, as its 2.4% slip today continued its horrific and extended slide. The company that runs the University of Phoenix is facing high dropout rates and the specter of losing its federal funding and accreditation if loan default rates climb

Dropping 1.5% Monday, BMC Software (BMC.DL) joins Apollo as a notable laggard after the business announced some big strategy changes. An SEC filing today revealed BMC is cutting its workforce, incurring pre-tax charges between $33 million and $38 million in the process. No word yet on how many of the company's 6,900 full-timers will be let go.

Lastly, Netflix (NFLX 7.65%) saw its shares slip yet again today, as its 1% loss brings its five-day stumble to more than 10%. With news last week that Time Warner's (TWX) Warner Archive Instant will allow streaming of classic Warner Bros. content for $10 a month, Netflix investors have gotten squeamish. Not only is this stiff new competition for Netflix, but it also raises questions about whether Netflix will be charged more for the Warner Bros. content it shows on its site. 

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Stocks Mentioned

S&P 500 Index - Price Return (USD) Stock Quote
S&P 500 Index - Price Return (USD)
^GSPC
$4,023.89 (2.39%) $93.81
Netflix, Inc. Stock Quote
Netflix, Inc.
NFLX
$187.64 (7.65%) $13.33
Time Warner Inc. Stock Quote
Time Warner Inc.
TWX
Apollo Education Group, Inc. Stock Quote
Apollo Education Group, Inc.
APOL
BMC Software, Inc. Stock Quote
BMC Software, Inc.
BMC.DL

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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