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.
Airbnb Checks In as a Short Play
Airbnb Inc. (ABNB) recently was downgraded to Sell with a D+ rating by TheStreet's Quant Ratings.
After reporting disappointing earnings and guidance, Airbnb has been smashed down on pretty heavy volume. No question the sudden gap down took many investors by surprise, and that move in and of itself turns the chart of the lodging platform provider bearish.
The gap up two days prior to earnings and then gap down left what is known as an "abandoned baby." Eventually that gap will fill, but it could be awhile. Moving average convergence divergence (MACD) is on a sell signal now and prior support in April is now resistance. The downtrend line slopes at a steep angle, so it appears any rallies will be sold aggressively like last time. With heavy volume on the selling as well (arrow), ABNB is good for a short play. If short, target the $90 area, put in a stop at $120.
Crown Castle Crumbles
Crown Castle Inc. (CCI) recently was downgraded to Hold with a C+ rating by TheStreet's Quant Ratings.
The stock of this cell tower owner is a three-time repeat offender. Crown Castle has been hammered of late, with a channel of lower highs and lower lows.
Volume has been elevated this past month or so, with that weakness showing up on the money flow at the bottom. MACD is also on a sell signal, and while the stock has fallen 24% in six week, there is no reason to step up and buy. Therefore, short here with a target of $98, but put in a stop at $120 just in case.
Rayonier's Charts Yell 'Timber'
Rayonier Inc. (RYN) recently was downgraded to Hold with a C+ rating by TheStreet's Quant Ratings.
This timberland REIT has been hammered mercilessly, with lower highs and lower lows and heavy turnover as well. That's just not a bullish combination, and even as the stock has tried to rally the sellers just continue to pound away.
The Relative Strength Index (RSI) is steep and bending lower, which tells us there is more downside to come. MACD is on a sell signal, too, and with no support in sight we see lower prices ahead. If short, put in a stop at $31 and set an aggressive target to $22.