This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

The 5 Dumbest Things on Wall Street: May 20

3. Hewlett Packard Memos Leaked; Honesty Not Intended

When three memos from HP's (HPQ - Get Report) CEO Leo Apotheker were leaked early this week, something shocking happened: the truth was inadvertently revealed.

In the memos, Apotheker warned his leadership that the company was facing "another tough quarter" in the three-month period ending in July, and demanded that top HP executives "watch every penny and minimize all hiring." Current HP employees will surely be thrilled to learn that, according to Apotheker, the company's current workforce plans were "unaffordable given the pressures on our business."

As a result of the leak, HP was forced to report its earnings a day early -- on Tuesday instead of Wednesday -- and slash its outlook.

Investors -- shockingly! -- were less than thrilled by the unintended truthiness. And with good reason. It's the difference between coming clean to your spouse about something bad, and having your spouse discover something bad while, say, going through your sock drawer.

Indeed, throughout the day Monday, the stock had been trading around the $40 mark. In after-hours trading Monday, HP shares plunged by 4.8%, or $1.91, to $37.89. By the end of trading Thursday, the stock had closed at $36.13.

"The consumer PC market continues to be challenged industry-wide," said HP CEO Leo Apotheker during a conference call, adding that the firm's consumer PC revenue was down more than 20% year-over-year. Apotheker said, however, that HP had a solid quarter overall, pointing to strength in servers, storage and networking -- and the firm's $4 billion of operating cash flow.

"We're confident that we will continue to see a good performance in our software business," Apotheker told TheStreet on the company's conference call with journalists Tuesday morning. "We're looking to expand our software portfolio -- we want to create a complete platform for software developers and we're going to expand our footprint in analytics and big data."

TheStreet Says: "Big data" refers to large data volumes that require specialized software tools, a buzzword touted by the likes of IBM and EMC (EMC). It presumably does not refer to the information contained in leaked memos.

3 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
AAPL $132.54 0.00%
AMZN $427.63 0.00%
BBY $34.33 0.00%
C $54.97 0.00%
GOOG $540.11 0.00%

Markets

DOW 18,232.02 -53.72 -0.29%
S&P 500 2,126.06 -4.76 -0.22%
NASDAQ 5,089.3620 -1.4320 -0.03%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs