10 Worst-Performing Stocks of 2015
None of the stocks profiled here is at the 'fail' level of Enron. But in a time of bull markets and healthy run-ups from the likes of Amazon (AMZN) and Netflix (NFLX), these stocks have lolled around like hibernating bears. Here we present 10 of Wall Street’s losers for 2015.
If you have had a bad year with stocks in 2015, just remember that it could have been worse: Back in the day, you could have owned shares in Enron. Countless investors got rolled with that stock, especially after Fortune magazine voted Enron "America's Most Innovative Company" for six consecutive years, from 1996 to 2001.
Groupon, Inc. (GRPN)
About the company: Founded in Chicago in 2008, Groupon is a daily deals website that offers discounted food, services and merchandise.
How it performed in 2015: Groupons for Groupon stock, anyone? Not even that deal would seem capable of lifting this company from its doldrums. The stock is down 90 percent since November 2011, and off 65 percent for the year. September's bad news that the company closed offices in six countries and laid off 1,100 didn't help matters. Groupon has been unable to shake its hard-luck reputation after it rejected Google's reported $6 billion takeover offer in 2010.
"The stock is clearly out of favor," said Katie Stockton, chief technical strategist for BTIG in New York. She noted that Groupon has been trending steadily lower almost all year after having posted a loss of nearly 30 percent in 2014.
"The downtrend has the support of negative momentum and has barely been interrupted, except for a couple of dead-cat bounces that failed well below its 50-day moving average," Stockton said. And indeed, no one wants to buy a dead cat, no matter how much Groupon discounts it.
Share Price, Jan. 2: $36.57
Share Price, Nov. 24: $26.46
About the company: Founded in 2004, GrubHub is an online and mobile delivery food ordering company that works in conjunction with local takeout establishments.
How it performed in 2015: The company's tagline is "Discover who delivers," but in terms of being a sound investment, GrubHub surely has not delivered. It posted abysmal numbers in 2015, with its stock off by 28 percent.
Even more shocking, the stock price is off by close to 90 percent since GrubHub went public in 2011. That's sliding faster than a greasy burger across a slick grill.
"As the food delivery space is one of the fastest-growing tech sectors with low barriers to entry, competitors have been popping up left and right quickly," said K.C. Ma, director of the Sarah George Investments Institute at Stetson University in DeLand, Fla. "The reason for this significant price drop has little to do with the company itself; rather, it has everything to do with the arrival of new competitors smelling blood."
In other words, you could say GrubHub's challengers are seeking a rare stake.
Spirit Airlines (SAVE)
Share Price, Jan. 2: $74.24
Share Price, Nov. 24: $38.61
About the company: Founded in 1980, Spirit Airlines is one of the least frilly of the no-frills carriers in the air passenger industry. It is based in Miramar, Fla.
How it performed in 2015: Running an ultra-low-cost airline is one thing, while having an ultra-low stock price is quite another. Spirit has fallen in value some 52 percent this year.
The airline is known for the "Bare Fare," which literally crams people into seats that do not recline, said Robert R. Johnson, president and CEO of The American College of Financial Services in Bryn Mawr, Pa. "Yet unlike many other stocks currently out of favor with investors, Spirit is very profitable, selling at a modest price-to-earnings multiple of nine times earnings," he said.
That could mean Spirit is undervalued. "It may actually be a good buy at these levels, as it is favored by many hedge fund managers such as Whitney Tilson of Case Management," said Johnson.
Symantec Corp. (SYMC)
Share Price, Jan. 2: $25.23
Share Price, Nov. 24: $19.81
About the company: Founded in 1982, Symantec is a Silicon Valley technology company dedicated to software for computer security, data backup and storage.
How it performed in 2015: While Symantec has enjoyed a global reputation for its computer software products, its Veritas information management division dragged it down. This led the company to sell off Veritas for $8 billion in August.
Symantec has yet to enjoy a share-price bounce. With its Norton brand of antivirus software, "revenue declined by 19 percent, a result of the sharp drop in personal computer sales and the increase in use of smartphones and tablets," Ma said. Still, no one should count this high-tech veteran out yet.
"Although Veritas makes up almost 40 percent of Symantec's revenue stream, we think the sale is a smart move," Ma said. "The divestment allows the company to return to the much-needed security market, and (to) reduce its dependence on the ailing antivirus software market."
Keurig Green Mountain Inc. (GMCR)
Share Price, Jan. 2: $131.97
Share Price, Nov. 24: $48.85
About the company: Founded in 1981, Keurig is known for its coffee and hot beverage brewing system, as well as its ground and whole-bean coffee products.
How it performed in 2015: Just because you spot those cute coffee K-Cups in office kitchens everywhere doesn't mean the stock is an investment pick-me-up. Keurig Green Mountain has dipped by almost two-thirds this year, a result of some badly timed stumbles.
The company's trouble started with a nearly 40 percent loss in stock value for missing both first-quarter and third-quarter 2015 earnings, Ma said.
The company also unveiled its Keurig Kold home soda system to scathing reviews. "This was another unfortunate early morning hangover purchase," one cheeky customer wrote on Keurig's website. "Concept is solid but holy moly this thing is HUGE. … This monstrosity is going back in the box. Perhaps I will re-gift it to someone who I don't really like."
Can Keurig perform a consumer correction? If so, it could mean a "huge" buy for investors. "The market has overdone it this time," Ma said. "Most valuations would suggest that Keurig Green Mountain is 15 (to) 20 percent undervalued."
Consol Energy Inc. (CNX)
Share Price, Jan. 2: $34.30
Share Price, Nov. 24: $7.52
About the company: Founded in 1864, this Pittsburgh-area firm is one of the nation's largest producers of coal and also has significant natural gas reserves.
How it performed in 2015: There is little you can do to console Consol stockholders these days, which is true for most people invested in the energy sector. Consol's market cap is fairly strong at $1.68 billion, but its stake in coal and natural gas runs up against the tide of falling oil and energy prices overall.
So even though it occupies a top spot in the coal industry, and claims a long history reaching back more than 150 years, Consol faces significant problems.
Chesapeake Energy Corp. (CHK)
Share Price, Jan. 2: $19.76
Share Price, Nov. 24: $5.49
About the company: Founded in 1989, Chesapeake Energy is the second-largest natural gas producer in the U.S.
How it performed in 2015: Can't energy companies catch any love? What's good for the consumer is ghastly for the investor, as Chesapeake has drilled a hole for itself that's 74 percent below where the stock sat at the start of 2015. The slide started in June 2014, and has amounted to Chesapeake stock losing more than 80 percent of its value.
"As oil and natural gas prices have fallen, so has the value of Chesapeake Energy's stock," said Derek Peterson, president and CEO of Terra Tech — which designs, develops and markets agricultural equipment — and a former vice president with Morgan Stanley. "The company also has nonoptimal levels of debt, and while investors may be inclined to invest in the company for a rise in share price, they'd be best served looking to other energy-based companies in better financial shape."
Share Price, Jan. 2: $55.15
Share Price, Nov. 24: $30.01
About the company: Founded in 2004, this San Francisco company posts crowdsourced ratings and reviews of local merchants, restaurants and businesses.
How it performed in 2015: The silver lining for Yelp is that the stock — down 46 percent in 2015 — was in much worse shape at the beginning of the month. From Nov. 1 to Nov. 24, it shot up 26 percent, due to a third-quarter earnings report that beat Wall Street expectations. But on the whole, Yelp still needs help.
"The problem with Yelp is that while revenues are growing, it can't seem to turn much of a profit," Johnson said. "Investors should give it one star."
Apollo Education Group (APOL)
Share Price, Jan. 2: $33.26
Share Price, Nov. 24: $7.16
About the company: Founded in 1973, this Phoenix-based company owns for-profit educational institutions, including the University of Phoenix, one of the nation's leading presences in online education.
How it performed in 2015: Investors in Apollo Education can do the math all too well — the current stock price represents a 78 percent change in the wrong direction. "Apollo Education Group has had an awful year," Miller said, noting that much of the stock's downward spiral occurred on March 25, when it shed 28 percent of its value after a glum second-quarter report.
"Increasing criticism from government regulators didn't help the stock's chances, either," Miller added, referring to accusations that the company has engaged in deceptive marketing.
GoPro Inc. (GPRO)
Share Price, Jan. 2: $66.87
Share Price, Nov. 24: $19.32
About the company: Founded in 2002, GoPro makes cameras used by thrill seekers such as surfers, mountain bikers and sky divers.
How it performed in 2015: GoLow — uh, GoPro — is a stock for Wall Street thrill seekers who don't mind living dangerously, as in "down 71 percent" dangerously. Why the wild ride?
"Growing inventories and sluggish early holiday sales have led analysts to reduce price targets and lower recommendations," Johnson said. "The stock sold for nearly $100 last fall. A GoPro under your Christmas tree would be a terrific gift; as part of your portfolio, it's like a lump of coal."
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