Markets

7 Big-Name Stocks That Are a Sucker’s Bet

The month of June has not been kind to investors, marred by massive sell-offs that have knocked the Dow Jones Industrial Average down 5% since May 31. Bargain hunters are chomping at the bit to pick up their favorite expensive stocks while they're "on sale." But I don't want you to get suckered into buying big-name stocks that have not been performing well just because they are a few dollar cheaper. So here is a list of mega-cap names that should be avoided, even at their newly discounted prices:

Stock to Sell #1 - Petrobras Petroleo Brasileiro (PBR)

Thanks to a downturn that started in April, integrated oil and gas company Petrobras Petroleo Brasileiro (NYSE: PBR ) has watched its stock drop 11% year-to-date despite very strong gains in the first part of 2011. PBR stock is down 13% in the last 12 months and is trading close to its 52-week low of $31.50.

Stock to Sell #2 - Berkshire Hathaway (BRK.B)

Warren Buffett run holding company Berkshire Hathaway Inc. (NYSE: BRK.B ) has had a lackluster couple of months, dropping 13% in the last 90 days and 8% year-to-date. Quarterly earnings growth of -58% last quarter is another reason to sell the "Oracle of Omaha's" stock.

Stock to Sell #3 - Google (GOOG)

It may be your go-to search engine, but Google (NASDAQ: GOOG ) should not be your go-to stock. GOOG is down 15% year-to-date and posted year-over-year quarterly earnings growth of -8% last quarter. With a $167 billion market cap this is one big stock to sell.

Stock to Sell #4 - Wells Fargo & Co. (WFC)

Diversified financial services company Wells Fargo & Co. (NYSE: WFC ) has dropped 19% in the last three months despite big gains in the start of 2011. WFC is down 7% in the last 12 months and is trading near its 52-week low of $23.02.

Stock to Sell #5 - Citigroup (C)

With a market cap of $108 billion, diversified financial services holding company Citigroup (NYSE: C ) is the next to make the list of stocks to sell. Down 3% in the last 12 months and 25% year-to-date, C is barely holding above its 52-week low of $36.20.

Stock to Sell #6 - Bank of America (BAC)

It may be a household name in the states, but Bank of America (NYSE: BAC ) stock should be dropped from your portfolio. BAC is down 26% in 2011 and 31% in the last 12 months. Don't over look the bank's stock recent quarterly earnings growth of -36%, year-over-year, either.

Stock to Sell #7 - China Life Insurance Co. (LFC)

Insurance company China Life Insurance Co. (NYSE: LFC ) has watched its stock value dwindle 17% year-to-date and 22% since last June. With a market cap of $95 billion, LFC is hovering dangerously close to its 52-week low of $50.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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