Watch Out for These Stocks at Risk of a Significant Earnings Decline

Welcome to Extreme Investor Network, where we provide unique and valuable insights to help you navigate the world of investing. As we enter the first-quarter earnings season, it’s crucial for investors to stay informed on stocks that may be at risk of a profit “blowup.”

According to Wolfe Research, there are certain stocks that investors should keep a close eye on. These stocks have been identified based on their earnings quality, with scores ranging from 0 (worst) to 100 (best). One such stock is Tesla, which has seen a 37% decline year-to-date due to increased competition in China and slower demand at home. Tesla scored a 2 on Wolfe Research’s earnings quality scale and appeared six times on the firm’s short screens.

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In addition to Tesla, other electric vehicle stocks like Rivian Automotive have also made Wolfe Research’s short list. Rivian, with a score of 3 in the fourth quarter of 2023, has tumbled 63% in 2024 and appeared on four of Wolfe’s short screens.

Outside of the technology and consumer discretionary sectors, Wolfe Research has named Pinterest, Walgreens Boots Alliance, and J.M Smucker as potential short ideas. These stocks, along with others like Lyft, Juniper Networks, and L3Harris Technologies, have appeared on multiple short screens and have earnings quality scores in the 20s.

At Extreme Investor Network, we aim to provide you with exclusive insights and analysis to help you make informed investment decisions. Stay tuned for more unique perspectives on the latest trends in the market and how you can maximize your investment potential. Stay ahead of the game with Extreme Investor Network.

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