Each week Trifecta Stocks identifies 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 five 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.
K12 Inc.
K12 Inc. (LRN) recently was downgraded to Hold with a C+ rating by TheStreet's Quant Ratings.
There are many casualties from the Covid-19 crisis and this technology-based education company is one of them. This stock was cut down at the knees and severely crippled. The cloud is red and continues to bleed, and volume levels are high as this stock is under major distribution.
When will it end?
We don't know, but with more selling likely around the corner it seems safer to be short. If so, put in a stop at $26 and ride it to the mid-teens.
Hamilton Beach Brands
Hamilton Beach Brands Holding Co. (HBB) recently was downgraded to Hold with a C+ rating by TheStreet's Quant Ratings.
This maker of small kitchen appliances broke a nice triangle, but it was a break to the downside. There was some follow through and there is much more down to come, with recent volume elevated on the down sessions.
Money flow just turned bearish and the Relative Strength Index (RSI) slopes downward in a steep manner. There is nothing good about this chart.
If short, put in a stop at $20 and look to ride this to the 200-day moving average around $14.
This commentary is an excerpt from "5 Bearish Bets" a weekly feature sent to subscribers of Trifecta Stocks. Click here to learn more about this portfolio, trading ideas and market commentary product.
Want to find out the other stocks we think look good short this week and how to play them? Click here for a trial subscription to Trifecta Stocks and get "Bearish Bets" each week!
-- Bob Lang and Chris Versace are co-portfolio managers of Trifecta Stocks.
