Eight of 2010’s Worst ADR Performers (ALU, AIB, IRE, NBG, BBVA, OTE, WMD, MPEL)

ADR investors have probably made money this year only if they were writing call options or if they were shorting the stocks.  The added currency component has greatly magnified the losses on paper here, and the bulk of the losers are in Europe.  We wanted to see which ones were down the most due to the currency-effect and the great sell-off we have seen of late.  The biggest losers we are tracking in ADRs is Alcatel-Lucent (NYSE: ALU), Allied Irish Banks plc (NYSE: AIB), Bank of Ireland (NYSE: IRE), National Bank of Greece SA (NYSE: NBG), Banco Bilbao Vizcaya Argentaria, S.A. (NYSE: BBVA), Hellenic Telecommunications Organization SA (NYSE: OTE), Wimm-Bill-Dann Foods OJSC (NYSE: WBD), and Melco Crown Entertainment Ltd. (NASDAQ: MPEL).

Alcatel-Lucent (NYSE: ALU) is one that just can’t seem to win in technology and telecom equipment.  Cisco is dominating the space and this turnaround is one where the steering wheel looks stuck on forward toward the cliff’s edge.  At $2.42, this is down over 51% from the 52-week high, with the range being $2.01 to $4.95.  If the U.S. quote systems are properly accounting for things, the market cap here is a mere $5.5 billion.

Of the E.U. banks in PIIGS-land the banks, we have a trifecta and the order does not matter.  Allied Irish Banks plc (NYSE: AIB), Bank of Ireland (NYSE: IRE) and National Bank of Greece SA (NYSE: NBG) are all in a three-way knife fight for the worst performer this year in banking ADRs:

• AIB at $2.18 is down 79% from 52-week highs, with the range being $2.17 to $10.42;
• IRE at $3.75 is down 81% from 52-week highs, with the (prior) range being $3.81 to $20.18;
• NBG at $2.15 is down 74% from 52-week highs, with the (prior) range being $2.16 to $8.37.

A runner-up in banks is Banco Bilbao Vizcaya Argentaria, S.A. (NYSE: BBVA). Its ADRs trade at $8.77, which is down almost 56% from the peak of the $8.84 to $19.78 prior range of the last 52-weeks.

Hellenic Telecommunications Organization SA (NYSE: OTE) is an Athens-based telecom operator in Greece, as well as in Albania, Bulgaria, and Romania.  Telecom is one sector which is largely deemed immune from local issues, but not so here.  With ADRs at $3.36, this one is down over 65% from the peak of the $3.43 to $9.72 prior range over the last 52-weeks.

Wimm-Bill-Dann Foods OJSC (NYSE: WBD) manufactures and sells dairy, beverage, and baby food products mostly in Russia.  So much for food being immune to economic woes… With ADRs at $20.00, this one is down over 74% from the peak of the $12.33 to $78.57 range over the last 52-weeks.

Melco Crown Entertainment Ltd. (NASDAQ: MPEL) is the only of our major Asian ADRs we track actively that is down this much.  The Macau casino and resort, probably wishes it was just a Vegas casino now based upon its relative share performance.  If the economy won’t get you, mandated regulatory hurdles sure can.  With Melco Crown’s ADRs at $3.83, the company is down over 54% from the peak of the $3.26 to $8.45 range of the last 52-weeks.

This list is not all the worst ADRs but is a snapshot of some of the key highlights (or low-lights) of the performance.  Stay tuned this week, we’ll be featuring several lists of ADRs to see where the carnage may have gone too far.

JON C. OGG