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.
Tyson Foods Isn't Appetizing
Tyson Foods Inc. (TSN) recently was downgraded to Hold with a C+ rating by TheStreet's Quant Ratings.
The chart of the food producer isn't pretty at all, with lower highs and lower lows all the way down to the current level. Indeed, Tyson has dropped nearly 40% from its 52-week high, a spectacular decline on some heavy volume selling. That is called distribution, with substantial institutional moves.
Notice that moving average convergence divergence (MACD) is on a sell signal. Also, money flow is now bearish and the Relative Strength Index (RSI) is bending lower. All are indicating the trend remains down, with lower prices ahead. Let's set a target at $45 and place a stop at $66.
Hyatt Merits a Short Stay
Hyatt Hotels Corp. (H) recently was downgraded to Hold with a C rating by TheStreet's Quant Ratings.
Hyatt is one of the premiere hotel operators around, but the chart is saying it's simply so-so. MACD is on a sell signal while money flow is bearish. There is nothing pretty about this chart.
Since the start of December Hyatt has been straight down, performing even worse than the rest of the market. The downtrend channel (yellow bars) is clearly defined, with lower highs and lower lows. A break below the 200-day moving average sets up for lower prices, so we'll put on a target of $80 here and place a stop above at $95.
Urban Outfitters Looks Out of Fashion
Urban Outfitters Inc. (URBN) recently was downgraded to Hold with a C rating by TheStreet's Quant Ratings.
The apparel and home goods retailer has fallen hard over the past few weeks. Indeed, the recent high was tagged at the start of December and it has been straight downhill on accelerated volume ever since.
Money flow was strong the prior two months but has turned bearish suddenly. The stock is at the 200-day moving average and in the cloud, but that is starting to turn red now, and with a crossover in the MACD a few weeks ago there is more downside here, believe it or not. Target the high teens with Urban Outfitters, but put in a stop at $28 just in case.