Today's 3 Worst Stocks
What goes up must indeed come down, and even though the decline was modest, the S&P 500 Index came down today, breaking seven consecutive days of gains. You can't win 'em all: a phrase perhaps best illustrated by today's bleak technology sector, which takes all three spots on Tuesday's worst-performing S&P companies.
Open-source software provider Red Hat , known primarily for its Linux operating system, helped the index break from its winning ways, cratering 4.8% after a Citi analyst spooked investors with a bearish update to his opinion on the stock. Citing simply the lack of a positive catalyst in the near future, as well as what essentially amounts to a lack of innovation in its services, the downgrade -- from a buy rating to a neutral rating -- struck a nerve on Wall Street.
Investors also booed yesterday's decision from salesforce.com to raise $1 billion via convertible senior notes, as the sales management company fell 2.8% today. Fresh off a year where the stock jumped nearly 70%, managing growth is vital to share performance. Today's message: The market doesn't fully support how Salesforce is going about financing that growth. With a CEO who acquires social-media advertising companies for nearly $700 million, as Salesforce did last year, it's understandable for shareholders to have a few concerns.
The crushing blow of unflattering analyst commentary also struck Apple shares today, as they lost 2.2% following a reduction in earnings estimates by Jefferies. Setting a $420 price target -- only $8 below Apple's current price -- the investment firm thinks sales may disappoint after performing supply channel checks. On top of that, Apple's dominance in the tablet market seems to be fading, according to research outfit IDC, which predicts that Android tablets will ship more units than iPads this year.
There's no doubt that Apple is at the center of technology's largest revolution ever and that longtime shareholders have been handsomely rewarded, with more than 1,000% gains. However, there is a debate raging as to whether Apple remains a buy. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.
The article Today's 3 Worst Stocks originally appeared on Fool.com.
Fool contributor John Divine owns shares of Apple. You can follow him on Twitter, @divinebizkid, and on Motley Fool CAPS, @TMFDivine.The Motley Fool recommends Apple and salesforce.com and owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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