Lots of stocks are getting as hot as some of the temperatures we're seeing around the country, but there's still no shortage of disappointments. Despite the rallying exchanges, there are plenty of companies that have bucked the trend to sport double-digit percentage losses so far in 2013.
Some of the names may be surprising, so let's take a closer look at five of this year's most surprising sinkers.
|
Company |
July 17 |
YTD Loss |
|---|---|---|
|
BlackBerry (BBRY +6.96%) |
$9.12 |
23% |
|
Rackspace (RAX +0.00%) |
$43.84 |
41% |
|
ZAGG (ZAGG +0.00%) |
$4.86 |
34% |
|
Barrick Gold (ABX +7.36%) |
$15.74 |
55% |
|
Ebix (EBIX +0.00%) |
$11.10 |
31% |
Source: Yahoo! Finance.
Let's start with BlackBerry. The smartphone pioneer has had a rough run in recent years, but things seemed to be picking up as 2012 came to a close. The stock had nearly doubled after bottoming out in the mid-single digits late in the summer, and things got even better in January, when BlackBerry officially unveiled its updated mobile operating system.
Unfortunately, the devices running the ballyhooed BB10 platform failed to live up to the hype. BlackBerry wound up selling just 2.7 million BB10 smartphones in its latest quarter, and that's not good enough as it continues to yield market share.
Rackspace wasn't very popular at the time of its IPO. The Web-hosting speedster was hoping to price its shares as high as $17, settling for $12.50 and wrapping up its first day of trading at $10.01. It got worse. Six months later, Rackspace bottomed out at $4. The story got a lot better after that, as business picked up and a push to host cloud-based applications paid off. The stock went on to be a 20-bagger when it peaked late last year.
Things haven't played out so well in 2013, with the shares losing more than 40% of their value. After back-to-back quarterly disappointments and weak guidance as cutthroat competition pressures pricing, Rackspace has been hit hard -- yet it's still trading at more than 50 times next year's earnings.
ZAGG makes third-party accessories for smartphones, tablets, and other consumer-electronics gadgetry. Its invisibleSHIELD -- a thin, protective film placed over touchscreens -- put it on the map, but ZAGG expanded beyond being a one-trick pony by moving into keyboard covers, chargers, and headphones.
The stock was rocked in May after a dreadful quarter. ZAGG earned just half of what Wall Street was expecting, and sales fell 7%. Analysts were banking on 20% top-line growth. And just when it seemed as if things couldn't get any worse, ZAGG lowered its outlook again this past week.
Barrick Gold has shed more than half of its value this year. Gold stocks have gotten slammed in 2013, and gold prices have posted a double-digit percentage decline, frustrating asset allocators who figured buying into the yellow metal would offset some of the inflationary pressures and hedge against geopolitical uncertainties.
However, Barrick's been hit harder than its peers after the development of its Pascua-Lama Project in Chile was suspended this year, with environmental concerns blocking the proposed mining. Class action lawsuits have started piling up since then, accusing Barrick of making misleading statements and concealing information.
Finally, Ebix has been dogged by bearish attacks for its accounting practices for some time, but the fast-growing insurance software provider seemed to be getting the last laugh back in April, when a Goldman Sachs affiliate offered to cash investors out at $20 a share. The $820 million deal seemed to justify Ebix's accounting, but the love didn't last.
The buyer walked away after a U.S. criminal probe into Ebix's accounting practices was initiated last month. Ouch.
Ready for a bounce
If you owned some of these losers, how about following the smart money into winners?
