In The Penalty Box

DEFINITION of 'In The Penalty Box'

A phrase referring to a company whose stock has plummeted with no rebound in sight. A company in the penalty box is often one that has received some bad news, ensuring the future lethargy of its stock. An example of this is a drug company with a key drug that doesn't get FDA approval. These types of companies will often stay in the penalty box for a long period of time.



BREAKING DOWN 'In The Penalty Box'

The term "penalty box" comes from the sport of hockey. In hockey, when a player commits a rules infraction, he or she is put in the penalty box near the player's bench. For a designated period of time, typically two minutes, a player is out of action and his or her team must play shorthanded. As a result, most teams go on the defensive and aim only to stay even (prevent the opposition from scoring versus scoring themselves).

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