The Dow Jones Industrial Average (INDEX: ^DJI) jumped a full 1.2% this week after several big-name companies reported strong earnings. But not every stock joined the party. These were the three worst performers.
Weekly Price Change
Bank of America (NYS: BAC)
Intel (NAS: INTC)
IBM (NYS: IBM)
Bank of America
B of A shares initially jumped after its earnings decline wasn't as bad as analysts had expected. But while the bank set aside less money to cover repurchase claims on bad loans it sold investors, the amount investors are claiming reached a record high. Worse still, the Consumer Financial Protection Bureau, which isn't captured on consumer issues like the OCC and Fed, is investigating nine banks' overdraft fee practices. B of A recently had to settle charges that it had been artificially inflated the penalties its customers owed. Last year, banks charged their customers $31.6 billion in overdraft fees.
Shares of Intel fell after the company reported pretty decent earnings. The chip giant made $0.56 per share this quarter -- higher than the $0.50 that analysts had forecasted, but not higher, perhaps, than what analysts and investors had hoped for. Sales were basically flat, but keep in mind that the quarter was 7% shorter than last year's 14-week quarter. Intel is busily preparing its invasion of ARM Holdings and Qualcomm's (NAS: QCOM) mobile space, buying up patents and inking partnerships with Google, Motorola Mobility, Lenovo, ZTE, Lava, and Orange.
IBM shares also fell after strong earnings results. Non-GAAP earnings rose 15% to $2.78 per share, and management raised its full-year outlook to $15 per share. Margins expanded, and free cash flow soared.
As Intel and IBM showed us this week, the stock market can push stocks up or down based on short-term noise and overly strict expectations. But that very fickleness is what creates bargains for those with an attention span longer than weeks or months. And with earnings season upon us, we can expect to see even more big moves and major opportunities for long-term investors. So check out "5 Stocks Investors Need to Watch This Earnings Season." Our chief investment officer and top analysts all agree that these are the ones you don't want to miss. Get free access to this special report.
At the time thisarticle was published Ilan Moscovitzowns shares of Google. You can follow him on Twitter, where he goes by@TMFDada. The Motley Fool owns shares of Qualcomm, Intel, IBM, Bank of America, and Google.Motley Fool newsletter serviceshave recommended buying shares of Intel and Google. The Motley Fool has adisclosure policy. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.
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