Netflix (NASDAQ: NFLX ), in keeping with its seemingly monthly tradition of
doling out bad news, gave investors more than they could stomach Monday with a
pair of lousy announcements, leading its stock to drop off yet again Tuesday.
Netflix, which previously had warned that it would be unprofitable for a few
quarters starting in 2012, drew its pessimism out across the whole year with the
announcement that it would lose money from start to finish. This news was
coupled with the company saying it would sell $200 million worth of convertible
bonds to Technology Crossover Ventures and $200 million in stock to T. Rowe
Price's (NASDAQ: TROW ) mutual funds and accounts. Netflix said it was raising
cash in an effort to buy more content for its video-streaming and DVD delivery
service two months after it failed to renew a contract with media provider
Starz. The 2012 forecast and the announced fundraising which puts Netflix in a
dangerous Catch-22 of spending money to try to catch up with declining revenue
knocked NFLX shares down 5.4% by the end of trading Tuesday. Hewlett-Packard
(NYSE: HPQ ) offered up more fare for bad-news gluttons Monday by reporting
disappointing fiscal Q4 earnings, then took a 5% dive early Tuesday before
recovering to about $26.65, or down less than 1%, by the end of trading. HPQ
beat analyst estimates with adjusted earnings per share of $1.17, but the
company's fiscal 2012 earnings forecast of $4 per share was far below Wall
Street expectations. Hewlett-Packard is down almost 40% in the past 52 weeks,
but investors should be wary of considering it a value buy . One of the top
blockbuster IPOs of the year , Groupon (NASDAQ: GRPN ), found itself hitting the
rewind button Tuesday when it sank to $20.07 just seven cents above its initial
valuation of $20 when it went public Nov. 4. Groupon had been sitting mostly
level for the past two weeks before shedding 10% Monday then another 15% today.
Groupon's faceplant came just after LinkedIn (NYSE: LNKD ) spent most of the
Monday down about 7% on its lockup agreement expiring . Three Up Gilead Sciences
(NASDAQ: GILD ): Up 6.89% ($2.50) to $38.76. Youku.com (NASDAQ: YOKU ): Up 5.64%
(82 cents) to $15.37. Melco Crown Entertainment (NASDAQ: MPEL ): Up 5.48% (46
cents) to $8.85. Three Down Frontline Ltd. (NYSE: FRO ): Down 41.04% ($2.13) to
$3.06. ( Read more about Frontline here ) Nokia (NYSE: NOK ): Down 7.64% (46
cents) to $5.56. Campbell Soup (NYSE: CPB ): Down 5.27% ($1.77) to $31.84. As of
this writing, Kyle Woodley did not hold a position in any of the aforementioned
stocks. Check out our list of previous IP Market Recaps .
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