Four names downgraded by TheStreet Quant Ratings today are worth looking at, as their shares are likely to continue falling based on their charts and indicators. Our proprietary Quant Ratings system crunches the numbers using a quantitative approach to stock selection, taking human emotions and biases out of the equation, and assigns ratings to stocks according to their relative risk-adjusted total return prospects over a 12-month horizon. (Click here to learn more about this dynamic tool for investors.)
When we look at this chart of Avis Budget Group (CAR), above, we see a double top at $70 followed by a lengthy decline. Prices are below the declining 40-week moving average. The On-Balance-Volume line is edging lower and the Moving Average Convergence Divergence (MACD) oscillator gave a sell signal below the zero line. All bearish.
Here, above, we see a two-year downtrend in place for Kennametal (KMT). There is no bottom in sight. The OBV line is weak and the MACD oscillator is bearish. KMT will need a lot of base-building before it looks better on the chart.
ViaSat (VSAT), above, has been trading sideways for more than two years. The OBV line is sideways and the MACD oscillator has been stuck around the zero line. Below the $55 mark and VSAT quickly becomes very bearish.
We have limited history on Advanced Drainage Systems (WMS), above, but notice how hard it went down after breaking below the 40-week moving average. The OBV indicator has turned down, telling us that sellers are more aggressive and the MACD oscillator is bearish. The way WMS rallied suggests that we will probably not find much support on the way down to stem the decline.