Here Is Why H&R Block, Mattel and Visa Were Big Losers on Monday

On Monday, investors saw early retail reports on how the start of the holiday shopping season went on Thanksgiving and Black Friday, as well as very preliminary reports about Cyber Monday.

Although these reports caused some stocks to decline during the first trading session of the week, President-elect Donald Trump once again was a reason that one stock fell.

Let's look at why a few stocks fell on Monday and whether investors should own them or look elsewhere.

1. H&R Block (HRB)
Shares of tax preparation company H&R Block fell about 9% on Monday, making it the worst-performing S&P 500 stock of the day. The stock is up more than 2% on Tuesday.

Monday's drop was mainly due to a poor analyst report from BTIG.

The firm cut its rating to sell from neutral and highlighted the negative sentiment building around the stock due to Trump's election victory. During the presidential campaign, he promised to cut taxes and make the tax code easier to understand through massive reform.

Although other politicians have promised these types of changes in the past and they have yet to happen, the belief that Trump might actually push them through took its toll on the stock. Regardless of whether tax reform occurs in the short term, nearly everyone agrees that something needs to be done, and in time, something likely will happen on this front.

H&R Block has some big issues to confront if and when reform occurs, depending on how sweeping the changes are and whether the company can diversify its business before then. 

2. Mattel (MAT)
The Nasdaq Composite's worst performer Monday was Mattel, which fell more than 2%, though it is up slightly on Tuesday.

The toy maker fell, despite early reports that its Barbie and Lego brands performed well on Black Friday.

Furthermore, one report indicated that Mattel performed better than rival Hasbro at Toys 'R' Us stores.

But investors may be concerned that high-tech "toys" may be hurting the true game makers as drones were big sellers, sales of the Nintendo gaming console sold out and virtual reality headsets flew off the shelves.

Both Mattel and Hasbro are seeing fewer customers due to more technologically advanced toys being created for a younger and younger audience every year. Both stocks can likely perform well in the future, but investors need to watch how big technology changes the toy landscape.

3. Visa  (V)
Finally, the Dow Jones Industrial Average's biggest lose Monday was Visa, as shares fell 1.31%, though they are up slightly on Tuesday. Monday's move lower was likely the result of concerns about lower-than-expected sales figures for the big shopping weekend and fears of higher-than-expected credit card fraud stemming from Cyber Monday and retailers being hacked.

Cybersecurity is a major issue, and we saw a few years ago the effects of a data breach during the holiday shopping season when Target had its credit card information compromised. When credit card information is stolen and the card is used to make fraudulent purchases, the card issuer and Visa take a hit, not the person who owns the card.

The company could see increased write-downs and lower profits if there is an increase in credit card hacking and fraudulent activity this year.

Visa is a holding in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. See how Cramer rates the stock here. Want to be alerted before Cramer buys or sells V? Learn more now.

---

All the stocks mentioned above are strong in one area or another, but they still may not be the right stocks for you due to their weaknesses. No worries! I still have a list of stocks you may like better and will profit from, regardless of what the markets do. With many calling for a coming crisis, now is the perfect time to make sure your portfolio is protected. Each one of these powerful, yet overlooked companies barely notices when the market tumbles. And they'll skyrocket when it rebounds. You can pick all seven up for pennies on the dollar right now. But that'll change the instant average investors catch wind of just how bad things really are. Get their names here before it's too late.

The author is an independent contributor who at the time of publication owned stock in V.

More from Stocks

Tesla Is Taking Apple's Ecosystem Model Up a Notch

Tesla Is Taking Apple's Ecosystem Model Up a Notch

Dow Loses Steam as Yields Hover Near 3% Threshold

Dow Loses Steam as Yields Hover Near 3% Threshold

After Facebook, Google's Data Practices May Be Under Fire Next

After Facebook, Google's Data Practices May Be Under Fire Next

Video: Jim Cramer on What Trade Tariffs and Rising Rates Mean for Stocks

Video: Jim Cramer on What Trade Tariffs and Rising Rates Mean for Stocks

The Stock Market Isn't Rigged, Just Look At The Odds (VIDEO)

The Stock Market Isn't Rigged, Just Look At The Odds (VIDEO)