5 of Last Week's Biggest Losers

5 of Last Week's Biggest Losers

There's never a shortage of losers in the stock market. Let's take a closer look at five of this past week's biggest sinkers.


Sept. 13

Weekly Loss

Model N



EZchip Semiconductor






Glu Mobile






Source: Barron's.

Let's start with Model N. A couple of analysts downgraded the company after the company issued a disappointing outlook for the new fiscal year that begins next month. Model N is forecasting revenue for the new fiscal year to clock in between $70 million and $80 million, well below Wall Street's target of $118 million on the top line.

EZchip Semiconductor stumbled after its biggest customer introduced a new product. Cisco accounts for nearly 40% of EZchip's business, and the market's fear is that its new nPower chip will eat into its orders for EZchip's networking chips. At least one analyst, Feltl & Co's Jeffrey Schreiner, is standing by his bullish rating and $39 price target. He argues that EZchip has managed to stay relevant despite seemingly threatening new products by Cisco in the past.

Nanosphere stumbled after pricing a secondary offering at a steep discount. The molecular diagnostics company priced 15 million shares at $1.75 apiece on Friday, and that's not what investors like to see when the stock had closed above $2 the day before. Nanosphere needs the money as it tries to gain traction with its gram-positive blood-culture test, but there's no joy in secondary offerings when a stock is near its 52-week low.

Glu Mobile also priced a secondary offering at a discount. The maker of smartphone and tablet games had to settle for a price of $2.10 for each of the new 6.3 million shares being issued. The stock was at $2.41 just before the news. Dilution is never a good thing, though Glu Mobile should be able to turn that capital infusion around into the development of new apps.

Finally we have Protalix BioTherapeutics sliding 11% on the week. The biotech exploring the commercialization of recombinant therapeutic proteins stumbled after raising $60 million through a convertible debt offering. The convertible nature of the financing means Protalix was able get by offering a mere 4.5% in interest, but that also means buyers can convert the notes to stock at a 22% premium to where the shares were when the pricing was announced.

In short, that's more dilution if Protalix appreciates in the future.

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