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The Five Dumbest Things on Wall Street This Week: May 18

5. Francesca's Foolishness

Listen up Dumbest fans, because here's a little cautionary tale about one really big twit.

Last Friday, shares of women's specialty retailer Francesca's (FRAN - Get Report) inexplicably sold off late in the trading day, falling more than 15% at one point. Rumors abounded at the time that Francesca's, which went public last July, was going to sell additional shares in a secondary offering and thereby dilute the company's stock. Another gaggle of gossipers attributed the company's nosedive to pre-lock-up selling.

Not until this past Monday was it revealed that the real cause of the stock's shellacking was not a potential secondary offering but a primary idiot in the form of Gene Morphis, the company's chief financial officer, who was fired over the weekend for improperly communicating company information through social media.

Yep, good old Morph apparently got canned for tweeting too many non-public details about the company under the handle "theoldcfo." Of course, his nom de Twitter is even more apropos now that Francesca's has named a new CFO in Cynthia Thomassee, who hopefully has learned the valuable lesson that certain thoughts -- like, say, ones that the Securities and Exchange Commission may care about -- are better left unblogged.

Here, for example, is one of Morph's greatest hits. On March 7, he tweeted, "Board meeting. Good numbers=Happy Board."

Morph wasn't kidding. Not even a week later Francesca's shareholders were certainly cheery, driving up the stock after the company beat Wall Street's fourth-quarter estimates by a hefty 3 cents and raised its first-quarter 2012 guidance.

In other words, had some savvy investor been following Morph's blog they could have profited handsomely from his inability to control his opposable thumbs.

Perhaps most stupidly, not to mention ironically considering their diligence led to his firing, a quick review of Morph's Tweets shows that he was well aware of his board's attention to detail.

Back on Nov. 30, he posted, "Survived another audit committee meeting. Why couldn't I get one of those lazy audit committees I read about?". And then on December 9, he presciently told his followers: "Board meeting in NYC. See if I get to keep my job another ninety days."

Look on the bright side Morph. At least you beat your tweet.
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