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Lululemon Athletica inc. (LULU), J.C. Penney Company, Inc. (JCP): This Week’s 5 Dumbest Stock Moves

Trust is a major part of any investing relationship, and right now Harvest Natural Resources just doesn’t have it.

4. EA: It’s in the blame
Things aren’t going well at Electronic Arts Inc. (NASDAQ:EA), and the CEO is taking the fall.

John Riccitiello will be moving on by the end of next week, resigning as CEO and stepping down from the boardroom.

“We have mutually agreed that this is the right time for a leadership transition,” the press release offers, but everyone knows that these decisions are rarely mutually agreed upon. Someone’s getting booted.

It’s an odd move given that shares of Electronic Arts Inc. (NASDAQ:EA) hit a fresh 52-week high just last week.

Electronic Arts Inc. (NASDAQ:EA)’s financial performance doesn’t match that 52-week stock chart, but it’s not just Electronic Arts Inc. (NASDAQ:EA) that’s struggling to grow in this environment. The entire video game industry is struggling at a time when die-hard gamers are waiting for new consoles to raise the stakes and mainstream gamers have moved on to cheaper and easier social and casual games.

Electronic Arts Inc. (NASDAQ:EA) has actually done more than its peers to embrace the social and casual games that have exploded in popularity at the expense of the console industry, which has suffered three brutal years of sharply declining sales.

A new CEO won’t change that.

5. Scholastic Corp (NASDAQ:SCHL) flunks out
Scholastic Corp (NASDAQ:SCHL) shares fell 14% yesterday after a dreary quarterly report.

The publisher of children books and educational materials posted a much wider loss than Wall Street was expecting on a 19% plunge in revenue.

It really shouldn’t come as a surprise that Scholastic Corp (NASDAQ:SCHL)’s in trouble during the seasonally sleepy fiscal third quarter. Just as Scholastic Corp (NASDAQ:SCHL) felt the pinch after the Harry Potter book series came to a close, it was up against the prior year’s success of the Hunger Games trilogy.

However, it’s more than just that. As schools and kids turn to tablets and e-readers, the demand for Scholastic’s page-turners is diminishing. Yes, Scholastic Corp (NASDAQ:SCHL) has digital initiatives on its own. It’s not stupid. It’s in the education business!

However, it will take a long time before digital revenue offsets the revenue generated from the business that it’s disrupting. Wall Street should’ve known better in assessing Scholastic’s actual state. It’s not stupid. It’s in the money-making business!

The article This Week’s 5 Dumbest Stock Moves originally appeared on Fool.com.

Longtime Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Lululemon Athletica. The Motley Fool owns shares of Harvest Natural Resources.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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