Beware When the Pros Say "Back up the truck and load up on this stock"

In 2001 share prices of independent power producers turned to the downside and many Wall Street types were telling investor to buy. The typical sales pitches were: "I would be a buyer on weakness", "the selling is overdone", "this correction creates an entry point" and "these stocks will rebound from recent weakness." And more aggressive recommendations included: "back up the truck and load up on this stock", "this stock is a screaming buy" and "you can't afford not to buy this stock."

But to the chagrin of many these stocks continued their slide and eventually their prices collapsed. Most investors who bought during the downside are still losing money. The charts of AES (AES) and Calpine (CPN) tell the story.

AES is on the upside but its price is still well below its peak.

Calpine attempted a brief price recovery but the company is near bankruptcy.