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Each week we identify names that look bearish and may present interesting investing opportunities on the short side.
Using technical analysis of the charts of those stocks, and, when appropriate, recent actions and grades from TheStreet’s Quant Ratings, we zero in on three names.
While we will not be weighing in with fundamental analysis, we hope this piece will give investors interested in stocks on the way down a good starting point to do further homework on the names.
Let’s Take a Whirl at Whirlpool
Whirlpool Corp. (WHR) recently was downgraded to Hold with a C+ rating by TheStreet’s Quant Ratings.
The appliance maker last Monday posted second-quarter earnings that beat expectations but also issued full-year earnings guidance that was below consensus. The stock rallied, which is often a good sign, but we see the door has slammed in Whirlpool’s face at the downtrend line.
That’s what happens in a bear market — rally to resistance and fail. We could see a move back down to the June lows very quickly as the Relative Strength Index (RSI) is weak and about to roll over.
If short, use a stop at $175, target the $143 area.
Put Albertsons in Your Short Cart
Albertsons Cos. (ACI) recently was downgraded to Hold with a C rating by TheStreet’s Quant Ratings.
The food and drug retailer has shown a steady stream of lower highs and lower lows. The downtrend channel is well-defined with the stock breaking down in late March. The trend is your friend, and it remains down for Albertsons.
Money flow ticked up but the other indicators are still bearish. We could see a move down to the low $20s before long, but put in a stop at $30 just in case.
No Joy for JOYY
JOYY Inc. (YY) recently was downgraded to Sell with a D+ rating by TheStreet’s Quant Ratings.
This Asian operator of social media platforms is a repeat offender in our bearish chart series, and for good reason. The stock has been pounded for months and has dropped about 50% since March.
Money flow is poor and the Relative Strength Index (RSI) is bending lower at a steep angle, signaling there is more downside to come here.
If short, target the $18 area, put in a stop at $31.
(Real Money contributor Bob Lang is co-portfolio manager of TheStreet’s Action Alerts PLUS. Want to be alerted before AAP buys or sells stocks? Learn more now. )
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