5 Dumbest Things on Wall Street This Week: March 15

5. Skullcandy's Target Practice

Could the Wall Street analysts tracking headphone seller Skullcandy ( SKUL) be any less plugged-in?

Skullcandy shareholders got their heads handed to them last Friday after the company reported higher-than-expected fourth-quarter sales, but said it expects a sizable first-quarter loss due to expansion-related expenses and the loss of bankrupt British music retailer HMV as a major customer. Skullcandy said it now sees a loss of 25 to 30 cents per share in the first quarter and a 30% drop in year-over-year revenue, which translates to around $37 million in sales. Shares closed down 22.5% to $5.21 on the news.

In case you were wondering, analysts on average penciled in a tidy quarterly profit of 5 cents a share for the company in Q1 on revenue of $59.8 million.

Talk about tone deaf! Were any of these jokers listening to the company at all? Because when the music stopped and the stock dropped there was not a chair to be found, just a bunch of useless, after-the-fact downgrades.

Investment bank Craig-Hallum cracked SKUL from buy to hold, reducing its price target to $8 from $15. Northland Capital halved its price outlook to $6 from $12.

Not to be outdone, Bank of America/Merrill Lynch slashed its target to $4.50 from $12 a share. And finally Piper Jaffray sliced its forecast to $4 from $7.

They may not want to hear it, but Skullcandy's analysts clearly need more target practice. The only thing they are hitting squarely right now -- aside from their own credibility -- is their client's pocketbooks.

4. Jeff's Jive

Gee whiz, Jeff Immelt. You sure do have a short memory.

In a letter to shareholders released Monday, General Electric's ( GE) CEO warned his investors about "political storms" impacting capital investment, citing the government's fiscal situation, excessive regulations and repeated budget battles as reasons why American companies may choose not to invest at home.

"The amount of regulation tends to grow during periods of financial strain and we are certainly seeing that in the U.S.," opined Immelt. "The number of 'major regulations' -- regulations with more than $100 million in impact -- has exploded in the last few years. The result has been an additional burden on business. Until we solve for these constraints, it is hard to see that the U.S. will return to its full growth potential."

Hey Jeff old buddy, we've got a solution if you are worried about sticky government red tape putting the kibosh on domestic PP&E spending: Don't screw up in the first place!

While we agree that Uncle Sam's legislative incapacity is far from encouraging, Immelt glosses over the fact that GE Capital -- a division which held assets equal to the country's sixth largest bank prior to the financial crisis -- was partially responsible for the very creation of the regulations he is now whining about. And we're not merely talking about all those funky subprime loans issued by GE's now defunct mortgage originator WMC Direct.

Back during the 2008 money market freeze, GE Capital converted itself -- with incredible state-assisted alacrity mind you -- to a bank and issued $139 billion in Federal Deposit Insurance Corp.-backstopped debt. GE Capital also raised over $16 billion in financing under the Federal Reserve's commercial paper funding facility.

Not only that. Treasury Secretary Hank Paulson didn't just break the bank for GE at the drop of a dime, but he didn't ask for a nickel in return.

For example, the U.S. government could have asked Jeff to bring back some of his overseas profits as payback for its largesse, yet neglected to do so. And as we learned from Bloomberg this week, GE currently holds $108 billion in untaxed corporate loot abroad, money which sure could build a lot of plants back home.

No, asset repatriation wasn't part of Jeff's very sweet, skin-saving deal. It was all one way. Jeff gorged on cheap taxpayer money with no strings attached, even while GE was paying that Omaha-based loan-shark Warren Buffett through the nose for the privilege of owning GE's preferred stock.

Actually, that's not entirely true. Immelt did pay back the government this week by giving former SEC chief Mary Schapiro a high-paying, low stress job as an independent director on GE's board. Perhaps having Schapiro on his payroll will give GE an even clearer path to Uncle Sam's piggy bank should the company hit money market turbulence again.

And more to the point, Jeff did serve his country proudly on President Obama's so-called Council on Jobs and Competitiveness. Maybe that's why he forgot to mention his own role in creating the crisis that led to all those capital investment-killing regulations. Those handful of meetings he attended over the past two years must have truly taxed his memory.

Lord knows that's the only thing of Jeff's that got taxed.

3. Best Buy's Bandwagon

Congratulations Best Buy ( BBY). Now that your stock has eclipsed $20 a share, Wall Street thinks it's a "buy" again.

Too bad they didn't come to that epiphany two months and eight points ago.

Shares of the electronics retailer popped 1% to $20.25 Tuesday after Goldman Sachs became the latest investment bank to jump on the Best Buy bandwagon. Goldman analyst Matthew J. Fassler upgraded his rating on the company to a "buy" from "neutral," slapping a one-year $25 price target on the stock.

"BBY remains in a challenged position, selling big-ticket commodities against lower-cost online competition. That said, we expect cost controls to aid profitability, and our estimates are now positioned above the Street for 2013-2014, even assuming ongoing gross profit declines," wrote Fassler.

Yeah, it's hardly a glowing review. Essentially Fassler is saying he expects the new management's austerity program to work at Best Buy, even if something similar is causing a revolution in Southern Europe.

Actually, what he is really doing is kicking himself for not pulling the trigger at the start of 2013 when the heavily-shorted stock (about 14% of its shares) was trading below $12. Now that it's been squeezed higher, he's also probably pissed that some of his competitors including analysts at Piper Jaffray and Jeffries beat him to the upgrade in the past week, making his own grand declaration look like a me-too call.

"Like other retail turnarounds we have seen, we are at the point in Best Buy's turnaround story where we don't have all the information we would like to understand the reinvention of Best Buy, but nonetheless we sense an inflection point," wrote Jeffries analyst Daniel Binder last Wednesday when he boosted his rating to "buy" from "hold" and his price target to $24 from $13.

Come again, Daniel? You "sense an inflection point"?

That's hilarious. You sense nothing of the sort. You looked at a stock chart and realized you had to play catch up.

Don't worry though. You made your point with us and ahead of Goldman. We suppose that's all that counts.

2. Bloomie's Soda Battle

A state Supreme Court Justice struck down New York City Mayor Michael Bloomberg's ban on oversized sugary drinks Monday night calling it "arbitrary and capricious." Bloomberg, in response to the 11th hour action, vowed to appeal the ruling.

That's where it stands now and, to be perfectly frank, the stalemate is fine with us. We here at the Five Dumbest Lab don't have a rooting interest in the city's soda battle. Like Bloomberg, we don't want obese, toothless kids waddling around our fair city, sucking down sugar-stuffed Big Gulps bigger than their little heads.

On the other hand, we do see the soda purveyors' point that, to succinctly state their legal case, Mayor Mike should mind his own goddamn business.

All those qualifications aside, while we won't weigh in on either side of this obesity/nanny-state debate, we do feel the need to comment on the stellar preparation made by some beverage sellers in the face of Bloomberg's embargo.

McDonald's ( MCD), for example, stocked up on sugar packets in advance of the ban that was supposed to begin Tuesday. Mickey Dees said customers ordering a large coffee would have been welcome to take as many sugar packets as they require.

Are you paying attention FEMA? Next time a hurricane threatens to devastate a small city, do like Ronald McDonald does and stock up on the sweet stuff!

Or how about Dunkin' Donuts ( DNKN), which readied its caffeine-addicted customers (hmmm, is coffee next on Bloomie's hit list?) by distributing leaflets to explain the law's impact on its menu. Dunkin's doomsday strategy was to serve its large drinks unsweetened and then direct patrons to a self-serve sugar station.

Luckily for the donut seller it never went that far, because anybody who has ever ordered an unsweetened iced tea knows that trick won't work. If anything, it causes you to dump even more sugar into the cup until you get a mound at the bottom.

Perhaps our favorite response came from Starbuck's ( SBUX), which claimed its beverages were milk-based and therefore fell outside the Mayor's ban altogether.

What a brilliant legal point! Who needs barristers when you have baristas?

"People are dying every day," Bloomberg said about the decision. "This is not a joke. This is about real lives."

Forgive our gallows humor Mr. Mayor. Just because it's not a joke doesn't mean it's not funny.

1. Spectrum Surrenders

There is no joy for Spectrum ( SPPI) CEO Raj Shrotriya. His mighty Fusilev has struck out.

After Tuesday's close, Spectrum Pharmaceuticals cautioned that sales of its colon cancer drug Fusilev will be $10 million to $15 million in the first quarter and $80 million to $90 million for all of 2013. By comparison, Fusilev sales were $44.6 million and $204 million in the fourth quarter and full year 2012, respectively.

Yeah, it was pretty gruesome. We haven't seen a swing and a miss that big since George Foster batted cleanup for the 1982 New York Mets.

And unfortunately for Spectrum, Fusilev is the biotech's biggest slugger, so its demise can't be made up elsewhere in the company's line-up. Total revenue for 2013 is now expected to be in the range of $160 million to $180 million compared to $268 million in 2012. Analysts, on average, were expecting Spectrum to bring home $297 million in revenue this year.

On the other hand, Spectrum's strikeout was a grand slam for the shorts, who have long been swarming all over this stock. Spectrum shares sank over 37% to $7.90 on Wednesday after closing the day before at $12.43.

The big score was especially sweet for Spectrum bears because Shrotriya has repeatedly thrown the market's equivalent of bean balls at them. In December, Shrotriya attempted to squeeze doubters out of the stock with a special cash dividend of 15 cents per share payable to the company's shareholders.

And on Feb. 21st of this year, Shrotriya really unloaded on the shorts, boasting on a conference call about Fusilev growth despite flat revenue for the past three quarters.

"Just how colossally awful is this new revenue guidance?" asks TheStreet's biotech ax Adam Feuerstein. "Just under one month ago, Spectrum CEO Raj Shrotriya promised investors more revenue growth in 2013. Tuesday, he admits first-quarter Fusilev sales will drop more than 70% sequentially. For 2013, Fusilev sales will retrench by a jaw-dropping 60%."

On the ensuing conference call Wednesday morning, Shrotriya pitched Spectrum as even more of a bargain now that Fusilev sales are stunted.

Oh man, that's an eephus ball if we ever saw one. With ridiculously weak offerings like that, we doubt the CEO best known for headhunting shortsellers will last much longer on Spectrum's mound.

In fact, we expect he'll be soon be visiting a headhunter himself. A corporate one.

-- Written by Gregg Greenberg in New York City.

Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.

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