Today's 3 Worst Stocks in the S&P 500
Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.
The S&P 500 Index ended at fresh all-time highs on Monday, edging slightly higher. Wall Street kept some momentum from Friday, when private sector payrolls jumped more than expected, showing strength in the jobs market. The S&P 500 Index added three points, or 0.2%, to end at 1,808 today. But despite the general uptrend, several stocks stuck out as big losers to begin the week.
Energy company Newfield Exploration slumped 8% in trading on Monday, ending as the worst-performing stock in the entire benchmark index. The fall came after a production output from Newfield management, which forecast domestic liquids production growth of 30% in 2014, far below the 38% Wall Street was looking for. Research outfit Jefferies, using today's figures, thinks the fair value of the stock today is closer to $23, a full 5.5% below today's closing level of $24.33. Shareholders should keep a close watch on production going forward to ensure these tempered targets are met, because if they aren't, day's like today could become commonplace in the future.
Another energy company, First Solar , saw its shares lose 3.3% Monday, despite little company-specific news you'd expect to impact the stock. That said, First Solar stock is more than twice as volatile as the market itself, and longtime investors in this innovative technology know the inherent risks in investing in such a new and unproven industry. Shareholders have been well-rewarded for their risk tolerance in 2013, as the stock soared more than 80% in that period. With First Solar now both profitable and a leader in the emerging solar segment, it's easy to see why the stock has been so successful. Competition from China continues to be a major factor to watch out for going forward.
Lastly, shares of Marathon Petroleum shed 1.9%, as Wall Street reacted with utter indifference to a report from JPMorgan, in which the bank boosted the price target on shares from $67 to $81. Marathon's stock was also upgraded to neutral from underweight, as JPMorgan expressed confidence that the Ohio-based refiner could improve its margins. The success of companies like Marathon Petroleum is almost entirely dependent on future oil prices, so investors should ideally have a strong opinion on how that market will play out before taking a position in an investment like this.
The article Today's 3 Worst Stocks in the S&P 500 originally appeared on Fool.com.Fool contributor John Divine has no position in any stocks mentioned. You can follow him on Twitter @divinebizkid and on Motley Fool CAPS @TMFDivine.The Motley Fool owns shares of JPMorgan Chase. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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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