Stocks I Sold That Went Down More Than 50%
Occasionally, you will be holding stocks that you should sell. It is not always going to work out when you sell. I've also sold 5 stocks that went up >50%. Most times, you should hold. But this only works when the business is executing its plan and reaping profits.
- DNUT, -51.00%
I entered Krispy Kreme Donuts for a short term trade to medium term investment. This was an ill-fated move. I instantly became a bagholder from $13, bought the dip a few times under $10. Sold some early in the trade at a loss (good move in hindsight). Finally, after 4 quarters of earnings reports, the donuts started to smell a little funky to me. Add in that the brand is not owned by its original owners, but a venture capital firm who bought them privately to then return to flounder in public markets. The business isn't as hot and fresh as its donuts. They failed to turn a profit in this most recent quarter and the past 2 reports stunk it up. My losses were sizable, but thankfully I had the sense to get out at $6 before this tumbled below $3.
- TDC, -51.55%
This company was a short-term trade of which I knew so little about the company Teradata. Purely traded on price for a small $100-$150 position, but closed at a small profit.
- LYFT, -64.24%
I wrote in an earlier post on this blog about my wise move to exit at $35-$55. The price currently sits at $16. In their case, it didn't pay to be #2 in the rideshare industry. More competition ramps up soon with Waymo delivering 250K rides and Tesla beginning its rollout in June.
- MTCH, -81.22%
I entered Match Group thinking it must be a high-margin business. Tinder and OKCupid are pinnacles of single dating life. However, I had no conviction in the idea nor the interest to understand the economics of dating apps. In retrospect, it was the right move. I sold my 3 or so shares before the bottom fell out of this stock.
- EB, -89.01%
Eventbright was a well-known startup in the ZIRP era. They pop up occasionally in ticketing for events I attend. I only owned 1 share, which I bought and sold above $20 for a small profit. The pandemic KO'd their business in a sense and the stock reflects it today.
- BYND, -97.11%
Beyond Meat rode a wave that turned out to be more of a fad. Veggie meat pops up occasionally at the restaurant. There are other products in this category, but it seems the demand for this type of food was overestimated. The position was only $500 or less. Thankfully I didn't hang onto this one.
- BRDS, -100%
It's not often you will sell a stock and it actually ends up going to zero. I was foolishly playing a trade for a bounce in a scooter company. This is my dumbest trade/investment idea ever. I simply didn't know what I was investing in. I saw some "merger" news that sounded bullish for them to become the largest scooter company in the USA via an acquisition of the scooter startup "spin". "Why not own the #1 scooter rideshare company?", I thought.. So I threw $200 in on a whim. The "news" (stock pump piece) of them becoming the #1 biggest scooter company in america was actually a precursor to "restructuring" and bankruptcy. This "restructuring" generally is not a good thing to hear for a business teetering on the brink of insolvency. Then more bad news hit. The company was delisted from the New York Stock Exchange for too small of a market cap. The ticker moved to over the counter (OTC) exchange and the ticker was later changed from BRDS to BRDSQ. I averaged down on my shares on the OTC, hoping to break even.
"We firmly believe that BRDS current market cap does not reflect the intrinsic value of the Company," Michael Washinushi, Bird's interim CEO, was quoted as saying in the statement on Friday. "And while disappointing, this change in our listing status on the NYSE does not alter our commitment to our shareholders, our valued employees across Bird and Spin, our partners and the many global cities and institutions with which we work."
/- CNBC, https://www.cnbc.com/2023/09/22/scooter-company-bird-delisted-from-nyse-will-trade-over-the-counter
The message from the business was that they were staying the course, rebuilding with the spin acquisition, and "committed to our shareholders". It turned out the acquisition was a facade to hide BIRD's rotten core. After getting some skin in the game, I was eyeing the upcoming earnings call to learn more about what was going on with this mysterious business. Little did I know, the executives had no intention to host the call. When they made a surprise late night blog post announcement to "restructure" assets and reconcile with creditors, I set my sell order. I didn't want to be left holding the empty bag. Thankfully I had subscribed to the company website via RSS feed so I immediately saw the news. My final trade executed at open at $0.26 to sell 500 shares I had bought anticipating a recovery. After I sold it all, that day it plunged to below $0.10. I managed to get out at a -79% loss, losing $490. It was small bet that resulted in big % short term losses in only 3 months from open to close of the trade. I deserved it for not doing my homework.
By selling at open the day after the bankruptcy news broke, I avoided the fall to zero and walked away with $129. Birds Global is no longer a publicly traded company, and no value was returned to shareholders due to all assets absorbed in repaying the scooter company's creditors. I still see their scooters in operation occasionally when I visit random cities. They have likely been absorbed by other scooter companies if they are still running or are still operating some places. The website still is live. If you search Bird scooters in the news, you'll see various cities are still kicking them out of town to this day. It's a constant reminder that good stocks will work for you and bad stocks take from you.