Stupidity is contagious. It gets us all from time to time. Even respectable companies can catch it. As we do every week, let's take a look at five dumb financial events this week that may make your head spin.
1. The HP weigh
Everyone sort of figured that Hewlett-Packard (NYS: HPQ) overpaid when it shelled out roughly $11 billion for Autonomy last year, but now we're finding out that HP may have been duped.
The PC giant shocked investors this week by announcing an $8.8 billion impairment charge, accusing Autonomy of defrauding HP by fudging its numbers in a deal orchestrated by then-CEO Leo Apotheker.
The gargantuan charge was simply the company adding insult to injury in its latest disappointing quarterly report. Revenue and adjusted earnings fell 7% and 3% respectively for HP.
HP may be saying all of the right things in admitting that it needs to focus on the products that folks are buying, but it's not as if it can just waltz right in and sit at the big boy's table for tablets and smartphones.
2. Joly holidays
HP wasn't the only stock hitting multi-year lows this week.
Best Buy (NYS: BBY) tanked after posting another uninspiring quarterly report.
No one should be surprised by the negative comps and another quarter of the consumer electronics retailer falling short of expectations on the bottom line. CEO Hubert Joly has only been on the job for 11 weeks, but he has his hands full with what may be an unwinnable war.
He has unrealistic expectations of improving comps and boosting margins, but achieving one will surely come at the expense of the other as consumers grow more price-savvy.
Best Buy's been a repeat offender in this weekly column over the past couple of years, but this time, let's go with Joly's closing remarks to analysts during Tuesday's earnings call:
Encourage everybody to shop at Best Buy between now and Christmas," he said at the end of the call. "And as you shop there, please give us feedback on your experience, both the good and the bad as we're focused on driving the customer experience now.
Yes, it's pretty much gotten that bad at Best Buy. The fate of its turnaround rests on analysts telling their friends and families to shop there.
"I look forward to your purchases and your feedback."
He's probably looking forward more to the purchases than the feedback.
Nintendo better hope that its diehard gamers are patient.
The struggling Japanese video game pioneer put out its Wii U on Sunday, but it requires a lengthy firmware update to get up to speed. The process can take as long as a couple of hours for folks, and that's with a reliable Internet connection.
Things have gotten ugly for anyone that has tried to interrupt the firmware update or experience an outage during the required update.
"Wii U owners, please do not power down or unplug your system while downloading updates." Nintendo tweeted on Monday. "Doing so may cause damage to your Wii U."
Yes, that's right. A few early adopters now have bricked systems because the company shipped out an incomplete gaming console.
Sure, it's covered under the warranty, but it's a hassle since many stores may be out of stock of the hot holiday plaything.
Oh, and keep in mind that many of the Wii U systems haven't even been opened yet. Younger gamers will probably be getting them for Christmas. Can you imagine the disappointment as kiddies have to wait what may seem like an eternity for what will surely be overloaded Nintendo servers.
If you think the horror stories are bad now, just wait until the end of next month.
The video game publisher revealed that its CFO is leaving and that it's in talks with a financial sponsor to see if it can drum up necessary funding.
The company that is best known for its Saints Row franchise and its once-popular line of licensed wrestling games is strapped for cash, and any lifelines are likely to be highly dilutive to current shareholders.
Be careful with this one.
5. Egg Tilly's
The cardinal rule for companies going public is to not disappoint investors in their first few quarters as public companies. Well, Tilly's (NYS: TLYS) apparently wiped out on that lesson.
The retailer selling surf, skate, motocross, and lifestyle apparel and accessories posted quarterly results for its first full reporting period since going public at $15.50 in May. It held up well on the bottom line, but it was a face plant on the top with softer than expected sales.
Even worse, Tilly's is now hosing down its guidance for the entire year. The stock tumbled 17% on Wednesday, falling below $15.50 to make it the latest busted IPO.
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The article This Week's 5 Dumbest Stock Moves originally appeared on Fool.com.Longtime Fool contributor Rick Aristotle Munarriz has no positions in the stocks mentioned above. The Motley Fool owns shares of Best Buy. Motley Fool newsletter services recommend Best Buy. 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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