This has been a phenomenal year for the U.S. stock markets. The S&P 500 Index has risen more than 340 points, or about 15 percent, while the Dow Jones Industrial Average’s point gain has been even more impressive at over 3,646 points, or about 18 percent.
Those gains make this list of underperformers even more significant. Most of the names on this list were popular stocks to buy before hitting rough times. Now, many look like stocks to sell. Look and see what some of the worst stocks for 2017 have been, then read about the stocks you should be investing in before the year ends instead.
O’Reilly Automotive (ORLY)
Price on Nov. 14: $215.89
Point decrease in 2017: -62.52
O’Reilly Automotive’s stock is an apt representative of the slogan, “the bigger they are, the harder they fall.” After trouncing the overall market returns in 2013, 2014 and 2015, O’Reilly began to see things slow in 2016, and 2017 has been flat-out disastrous, especially in the midst of a big market rally. The problem for O’Reilly, as with many companies, seems to be Amazon. The online retail giant has set its sights on the lucrative auto parts market, and industry leaders like O’Reilly have suffered significantly as a result.
Price on Nov. 14: $148.89
Point decrease in 2017: -16.10
IBM is emblematic of the problems that can happen when an old industry stalwart isn’t quick enough to change its direction and set a new course when technology evolves. “Big Blue,” as the company is known, is one of the companies in the 30-member Dow Jones Industrial Average, an index comprised of leading companies across various, wide-reaching industries. IBM’s stock is still more than 30 percent below its 2013 high as revenue continues to fall during the company’s attempted turnaround. IBM has reinvented itself at least once before — can it do it again?
Under Armour (UAA)
Price on Nov. 14: $12.15
Point decrease in 2017: -16.90
Under Armour is another former high-flyer that hit the skids in 2017. The stock is down more than 50 percent in 2017 after dropping 30 percent in 2016. Following an impressive run that saw its stock price grow no less than 31 percent a year between 2010 and 2015, Under Armour has fallen back amid a dramatic slump in sales. During the 2017 third quarter the company reported a 5 percent year-over-year decline in sales, well below analyst estimates. That performance took the stock down more than 20 percent in a single day. Sneakers that no longer seem fashionable, along with supply chain issues, leave the company with a muddled outlook. Endorsing Golden State Warriors star Steph Curry was instrumental in growing Under Armour’s reach, but there’s a limit to the impact any single player can make.
Price on Nov. 14: $19.70
Point decrease in 2017: -16.11
This formerly revered department store chain has found itself in dire straits. While Macy’s was always a champion of old-line retailers, the explosion of online shopping — and its lower prices — has taken its toll on the company. Macy’s stock price has been in a downward spiral since hitting an all-time high of 73.61 in July 2015. Shares dropped 44.68 percent in 2015, continued to decline the next year and were down more than 40 percent in late 2017. Macy’s is by no means alone in its despair — the entire retail sector has been under pressure. But Macy’s has been hit particularly hard. Its stock fell 14 percent in October 2017 alone, as guidance across the industry dropped and the entire sector took a hit when rival Nordstrom failed to secure financing to go private.
General Electric (GE)
Price on Nov. 14: $17.90
Point decrease in 2017: -13.70
General Electric is the oldest member of the Dow Jones Industrial Average, but its stock performance of late has left some wondering if it will be dropped from the average after 110 years. GE recently reported poor earnings, contributing to a 2017 price drop of more than 30 percent. That makes it by the far the worst performer on the Dow. Beyond that, the price of its stock could be an issue in terms of whether GE can remain on the average. The Dow is weighted by share price, not by market capitalization, as with other indexes such as the S&P 500. This means GE’s low share price doesn’t have much effect on the index. Additionally, the committee that selects Dow stocks likes to have no more than a 10 to 1 ratio between the highest priced stock price in the index — currently Boeing at about $258 — and the lowest priced stock. GE is still a huge company, but its market cap has fallen by more than $100 billion in 2017
Price on Nov. 14: $44.22
Point decrease in 2017: -9.16
Before GE overtook its position, Verizon had been the worst-performing stock in the Dow. Verizon operates in a very crowded field, and motivated competitors like T-Mobile have been taking market share away from the company. During the 2017 first quarter Verizon lost subscribers and also fell short of earnings and revenue estimates. The company had begun to right the ship a bit by Q3, as earnings met expectations and revenue exceeded them. However, the stock tumbled again in early November after news that a merger between T-Mobile and Sprint fell apart, sending the entire wireless sector lower.
Find Better Investments: 9 Safe Stocks for First-Time Investors
Price on Nov. 14: $33.72
Point decrease in 2017: -8.81
AT&T finds itself in the same predicament as Verizon: struggling with competition. But whereas Verizon’s struggles lie primarily in the wireless industry, telecommunications giant AT&T also suffers from the loss of cable subscribers. As consumers continue to “cut the cord,” pay TV services such as AT&T’s DirectTV have suffered the consequences. That’s a trend that may be hard to reverse. The advent of 5G fixed wireless might also impact AT&T’s future home internet revenue. While Verizon has fallen more points in 2017, AT&T’s percentage price drop is higher at more than 20 percent.
Price on Nov. 14: $82.24
Point decrease in 2017: -8.02
ExxonMobil’s stock performance has been sluggish for the past five years as shares continue to trade near where they traded in 2012, despite the overall market’s recent gains. In fact, ExxonMobile’s stock price in May 2007 was higher than it is now. In 2017, the stock was down about 9 percent through mid-November. While ExxonMobile’s attractive dividend yield has been growing, giving many investors a reason to buy or hold the stock, the share price has simply not participated in the great bull market that started back in 2009.
Altria Group Inc. (MO)
Price on Nov. 14: $65.73
Point decrease in 2017: -1.89
Altria Group’s price drop so far in 2017 is minuscule. However, it does reverse a string of double-digit percentage gains over the previous five years, so it’s striking in light of a continuing bull market. Perhaps more concerning is that the stock is down about 12 points — or more than 16 percent — from its recent high established in June 2017. The giant tobacco company has been a pretty steady performer financially, but still finds itself swimming upstream as Gallup polling reveals the continued trend towards fewer smokers.
Walt Disney Company (DIS)
Price on Nov. 14: $103.17
Point decrease in 2017: -1.05
A 1-point drop on a $100-plus stock price might not seem like much. But as one of the most well-known companies in the world, Disney’s decline in an environment where the broader market rose 20 percent or more is noteworthy. Disney is at a crossroads right now. While its core businesses are floundering — revenue at its biggest segment, media networks, fell 12 percent during the fiscal 2017 fourth quarter — Disney is moving rapidly into the video streaming business, pricing its venture well below the cost of industry giant Netflix.
Up Next: 10 Stocks That Soared in 2017