UTSanDiego.com

5 Dumbest Things on Wall Street This Week: March 15

Tickers in this article: BBY DNKN GE MCD SBUS SKUL SPPI

5. Skullcandy's Target Practice

Could the Wall Street analysts tracking headphone seller Skullcandy (SKUL) be any less plugged-in?

Skullcandy shareholders got their heads handed to them last Friday after the company reported higher-than-expected fourth-quarter sales, but said it expects a sizable first-quarter loss due to expansion-related expenses and the loss of bankrupt British music retailer HMV as a major customer. Skullcandy said it now sees a loss of 25 to 30 cents per share in the first quarter and a 30% drop in year-over-year revenue, which translates to around $37 million in sales. Shares closed down 22.5% to $5.21 on the news.

In case you were wondering, analysts on average penciled in a tidy quarterly profit of 5 cents a share for the company in Q1 on revenue of $59.8 million.

Talk about tone deaf! Were any of these jokers listening to the company at all? Because when the music stopped and the stock dropped there was not a chair to be found, just a bunch of useless, after-the-fact downgrades.

Investment bank Craig-Hallum cracked SKUL from buy to hold, reducing its price target to $8 from $15. Northland Capital halved its price outlook to $6 from $12.

Not to be outdone, Bank of America/Merrill Lynch slashed its target to $4.50 from $12 a share. And finally Piper Jaffray sliced its forecast to $4 from $7.

They may not want to hear it, but Skullcandy's analysts clearly need more target practice. The only thing they are hitting squarely right now -- aside from their own credibility -- is their client's pocketbooks.

4. Jeff's Jive

Gee whiz, Jeff Immelt. You sure do have a short memory.

In a letter to shareholders released Monday, General Electric's (GE) CEO warned his investors about "political storms" impacting capital investment, citing the government's fiscal situation, excessive regulations and repeated budget battles as reasons why American companies may choose not to invest at home.

"The amount of regulation tends to grow during periods of financial strain and we are certainly seeing that in the U.S.," opined Immelt. "The number of 'major regulations' -- regulations with more than $100 million in impact -- has exploded in the last few years. The result has been an additional burden on business. Until we solve for these constraints, it is hard to see that the U.S. will return to its full growth potential."

Hey Jeff old buddy, we've got a solution if you are worried about sticky government red tape putting the kibosh on domestic PP&E spending: Don't screw up in the first place!

While we agree that Uncle Sam's legislative incapacity is far from encouraging, Immelt glosses over the fact that GE Capital -- a division which held assets equal to the country's sixth largest bank prior to the financial crisis -- was partially responsible for the very creation of the regulations he is now whining about. And we're not merely talking about all those funky subprime loans issued by GE's now defunct mortgage originator WMC Direct.