The Most Disliked Companies
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The financial web site Marketwatch.com recently published a slideshow which listed the ten most hated companies in the country according to a survey. The hate (I prefer the term dislike actually) can be directed from customers, employees or shareholders.
Topping the list is J.C. Penney Company (NYSE: JCP). Some of the perceived misdeeds leading to the notorious ranking include elimination of its dividend and a declining stock price (angering shareholders) and a different pricing structure (angering customers and resulting in a 20% decline in sales). Since CEO Ron Johnson came on board in November 2011 shares have dropped 43%. Over the same period the S&P500 index gained 18%. However, things could improve as the earnings outlook is brightening somewhat.
Number two is DISH Network Corporation (NASDAQ: DISH). In addition to alienating customers by dropping a popular entertainment channel (AMC) from its lineup, the company also has run afoul of its own employees who claim that there is a intolerable working environment and "a culture of condescension and mistrust" created by the management. It was ranked as the worst American company to work for in a survey last year. However, in spite of those issues the stock price has risen, up 43% since Nov. 2011, and the shareholders haven't been affected yet.
Perhaps a little surprising is the 4th most disliked company in the survey. The "social network" Facebook (NASDAQ: FB) is on the list primarily due to privacy violations impacting its users, now numbering over a billion worldwide. In addition, technical problems at the time of the IPO in May 2012 affected shareholders. Some investors were not able to buy stock or their order was in limbo for days. The price has seesawed from a high around $38 to below $20 and then back up to around $30. Many shareholders are not sleeping at night.
The company at number five is Citigroup (NYSE: C) which hasn't recovered from the 2008 - 2009 financial crisis as well as some of its peers. The stock is only up about 16% since a bottom was reached in March 2009, significantly trailing the overall market. The board of directors fired CEO Vikram Pandit late last year due to frustrations over the pace of his cost cutting and the mishandling of the sale of its Smith Barney unit. The new CEO, Michael Corbat, has continued some of the same policies, including mass layoffs, probably not endearing himself to employees either.
Rounding out my abbreviated list is Hewlett-Packard Company (NYSE: HPQ) which was ranked as the tenth most hated. H-P is also considered by some analysts to be the most mismanaged company today. The stock has dropped by 40% over the last year which certainly won't be cheered by many shareholders. In October 2012 the company reported a trailing twelve month loss of $12.6 billion. As recently as six months ago H-P was reporting a profit. Myriad issues affecting the company combined with overall weakness in the PC industry doesn't bode well. CEO Meg Whitman has a tough road ahead.
Like many of the worst companies to work for, the most disliked businesses may not be a good investment either. There is a reason that they are on the list.
Mathman6577 has no position in any stocks mentioned. The Motley Fool recommends Facebook. The Motley Fool owns shares of Citigroup Inc and Facebook. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!