Title: 2024 Market Insights: Major Underperformers Dragging Down the S&P 500
As we look ahead to 2024, the S&P 500 is poised to reflect remarkable growth, with expectations indicating a potential rise of around 23.8%. This is a significant leap from the average annual increase of 11% we’ve witnessed over the last decade (2014-2023). However, this overall positive trend doesn’t tell the complete story. The gains have been unevenly distributed across sectors and individual stocks.
At Extreme Investor Network, we dive deeper into the numbers to help you understand the market’s current landscape and where there may be opportunities for savvy investors. While many sectors are flourishing—most notably, communication services, which has seen an impressive surge of over 40%—we cannot overlook the heavyweights that have stumbled considerably.
Spotlight on the Underperformers
Let’s take a closer look at the three biggest laggards of 2023 and evaluate their prospects:
1. Walgreens Boots Alliance (WBA)
Walgreens Boots Alliance has come in as the least performing stock of the year, plummeting more than 64%. This dramatic fall represents not only a pivotal downturn for the retail pharmacy chain but also sets the stage for what could be its most challenging year in history. Boasting an average hold rating from Wall Street analysts, expectations suggest only a modest rebound of about 5%. This lackluster forecast is concerning, especially following Walgreens’ removal from the Dow Jones Industrial Average—a move reflecting the broader market’s attitude toward the stock.
Investor sentiment swung like a pendulum; the stock tumbled over 20% after dismal third-quarter earnings in June but rebounded briefly on rumors of a potential acquisition by private-equity firm Sycamore. This volatility highlights the unpredictability surrounding Walgreens’ future, ultimately making it a less appealing choice for investors.
2. Intel (INTC)
The technology sector isn’t immune to struggles either; Intel is facing one of its worst years on record, with losses exceeding 60%. Once a titan in the hardware space, the company has been losing market share to competitors, particularly Advanced Micro Devices (AMD). The hype surrounding AI has left Intel behind, prompting the company’s board to make drastic changes, including the recent retirement of CEO Pat Gelsinger.
Although analysts have placed a hold rating on Intel shares, there’s a glimmer of hope on the horizon, with an upside potential of over 26%. Savvy investors should be cautious, however, as the company’s ability to navigate the rapidly evolving semiconductor market remains uncertain.
3. Moderna (MRNA)
Hot on the heels of these underperformers is Moderna, which also experienced a staggering 60% drop this year. The excitement that once surrounded the company’s COVID-19 vaccine has faded, with investor interest now shifting toward other healthcare innovations, like the new generation of weight-loss drugs. In response to this waning attention, Moderna has significantly slashed its sales guidance and announced cost reductions exceeding $1 billion.
While many analysts continue to maintain hold ratings, the projected price target suggests a potential rebound of approximately 87%. However, this forecast hinges on whether Moderna can innovate and pivot towards new market demands beyond the pandemic landscape.
Conclusion: Understanding the Market’s Terrain
The uneven performance of S&P 500 components reminds investors of the necessity to diversify and conduct thorough research before making investment decisions. Although 2024 is shaping up to be a promising year overall, stocks like Walgreens, Intel, and Moderna demonstrate that the journey to recovery often involves significant risks.
At the Extreme Investor Network, we are committed to arming you with the insights and tools needed for your investment strategy. By staying informed, you can navigate these turbulent waters and seize opportunities before they become widely known. Remember, investing is not just about following the markets; it’s about understanding the stories behind each stock and sector. Prepare yourself for the year ahead with comprehensive research and an informed strategy!