What Happened to These 10 Big Losers?
Last week was another volatile one for investors. Among the 10 biggest losers were a wheel maker, a photography pioneer, and a fast-growing mobile apps maker.
Recognize any stocks you own there?
Imperial Holdings shed nearly two-thirds of its value after the FBI raided the Florida-based company's offices. Imperial's business revolves largely around buying out life insurance policies and structured legal settlements at a discount to their eventual payouts.
This is an ethically controversial business. Not everyone feels comfortable with a company that buys policies of folks that may be dying in exchange for lump sum payments that they can use while they're still around. However, the FBI doesn't raid a company's books just because a business practice has its detractors: There was also some strange trading activity in shares between the time the raid began and when the stock was halted after it became publicly known.
A Boca Raton soap opera wasn't the only thing that went wrong this week. Let's take a look at 10 of the week's biggest disappointments.
Eastman Kodak (EK)
Imperial Holdings (ITC)
Focus Media (FMCN)
Camelot Information (CIS)
KEYW Holding (KEYW)
Glu Mobile (GLUU)
Extorre Gold Mines (XG)
Eastman Kodak wasn't a pretty picture after the shutterbug pioneer revealed that it was drawing $160 million from its credit line for "general corporate purposes." Things got worse after the stock was halted on fears that Kodak would be filing for bankruptcy.
Earlier this year, there was hope that Kodak's patents would help breathe new life into the company, but now institutional investors are asking the iconic photo giant to put itself up for sale. It's a sound suggestion, but who would buy Kodak at this point?
Focus Media runs a huge advertising network of billboards, poster frames, and ad-displaying monitors in China. It was generally a rough week for Chinese equities, but fears that the economy is slowing in the world's most populous nation are weighing down a company that can shrivel up when there isn't enough disposable income out there for advertisers to fight over.
There's apparently a big difference between Accuride and accurate. The Indiana-based maker of wheels and truck parts originally expected to earn between $0.40 a share and $0.50 a share this year. Now it sees itself generating no more of a profit than $0.04 a share and possibly even a small deficit. The wheels have come off, one could say.
Does Camelot Information Systems get its name because the market likes to lance a lot? It was a bad week for Camelot as it lowered its guidance, was downgraded by William Blair, and revealed that some key executives took out margin loans secured by Camelot shares.
Xueda Education runs 256 learning centers throughout China, offering tutoring services to primary- and secondary-school students. It graduated from the school of hard knocks this week after lowering its guidance. Xueda blames its revised compensation structure for causing the lower-than-expected revenue growth.
KEYW Holding stumbled after the online security specialist revealed that it had lost out on a lucrative Aura systems integration contract to a competitor.
Glu Mobile was riding high earlier this year after rival PopCap Games was acquired and Zynga began commanding pre-IPO valuations greater than traditional video game software companies. Investors aren't feeling so confident about the mobile gaming upstart these days. It also didn't help that a report began to circulate suggesting that an important director was leaving Glu to join a competitor.
PharmAthene had a big courtroom victory the previous week against SIGA (SIGA), but investors aren't feeling so confident that the decision will stick if we go by the weakness in PharmAthene shares last week.
Finally, we have Extorre Gold Mines. The Vancouver-based miner with operations in Argentina fell every single trading day last week. Gold and mining stocks may have been big winners during the summer, but fears of a commodity bubble are scaring some bulls away.
Longtime Motley Fool contributor Rick Munarriz does not own shares in any of the stocks in this article.