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. Penney for your thoughts
J.C. Penney (NYSE:JCP) is back -- or at least its marketing department seems to think so.
"We brought back the things you like about J.C. Penney, gave you new things to explore, and now we're happy to say you've come back to us," goes the sluggish department store chain's latest television commercial.
This would've been neat if J.C. Penney were telling the trust. A week ago, the retailer reported that same-store sales fell a 16.6% during the fiscal first quarter that ended on May 4. This is after an 18.9% plunge during last year's fiscal first quarter.
Thursday's quarterly report offered some glimmers of hope, but it still posted a larger loss than Wall Street was bracing for. This chain is still far removed from where it was before it stumbled.
Who came back to you exactly, J.C. Penney?
2. Deere John
There is no fall harvest waiting for Deere (NYSE:DE).
Shares of the maker of tractors and other agricultural equipment stumbled after posting uninspiring quarterly results.
The problem at Deere is guidance. It now sees revenue growing just 5% for the entire fiscal year that ends in October. That may not seem so bad if you didn't know that net sales rose 9% through the first half of the year, and Deere is initiating guidance for the current fiscal third quarter calling for 3% in top-line growth. Work the math and it means that the fourth quarter will be flat.
3. Office jerk
Microsoft's (NASDAQ:MSFT) Surface RT has been a dud, but a second act may be in the works.
Asia's occasionally well-connected DIGITIMES is reporting that the software giant will roll out a new Surface RT next month. The new tablet running Microsoft's poorly received Windows RT operating system will be slightly smaller but also apparently a lot cheaper.
DIGITIMES is hearing that the new 8-inch tablet may sell for as little as $249.
Microsoft is still going to have a hard time making this work. Developer support isn't there, and a tweaked Office suite isn't enough of a selling feature. However, at least it appears that Mr. Softy finally gets it on price. Pricing the original Surface RT at a starting point of $499 was a terrible business decision at a time when Microsoft had to be aggressive.
It may be too late for Windows RT.
4. Highway to Dell
Dell (UNKNOWN:DELL.DL) investors have to wonder why two parties are actually fighting for the fading PC giant.
Dell posted disappointing quarterly results on Thursday. Reported profits plunged 78% on a 2% dip in revenue.
There's no easy fix at Dell. It's not a matter of it making the right products, because folks haven't taken to Dell's forays into tablets and smartphones in the past.
Dell is Olive Oyl, being fought over by a pair of throwback brutes that are too busy fighting to realize how ugly what they're fighting for really is.
Speaking of ugly, this last item isn't going to be pretty.
5. Abercrombie & thanks for the Fitch
Abercrombie & Fitch (NYSE:ANF) attracted viral venom for something that its CEO said in 2006.
Really? Something he said seven years ago is coming back to haunt CEO Michael Jefferies.
To be fair, it was pretty brutal. Jefferies' comments in a book boasting that the retailer deliberately goes after "the cool kids" by not stocking XL clothing or women's pant sizes greater than 10 have stirred up activists concerned about what the opinion will do to people who already have a negative body image.
Thumbing through the borderline risque A&F catalogs has communicated the same message for years, but it sounds harsher when someone's actually voicing his displeasure with having larger people wearing his company's clothes.
One clever protester snapped up A&F clothing and promptly handed it over to the homeless.
A&F is no stranger to controversy, but there's little positive that can come out of having its clothing associated with superficial attributes and bullying.