Best Stocks To Short Today Ahead Of Federal Reserve Meeting

Markets were under some mild pressure this morning after Senate Majority Leader Mitch McConnell tabled the Republican coronavirus relief plan after markets closed on Monday. Among other things, the bill set federal unemployment insurance at 70% of worker’s previous wages, set to replace the $600 a week bump that was set to expire this week. It was seen that this will end up butting heads in Washington and could slow the delivery of any benefits to those who need it most. In addition, a couple of major earnings were out this morning with McDonald’s and 3M MMM . McDonald’s disappointed with a 30% drop in revenues, causing a selloff in shares about 1% or so. 3M was even more disappointing, missing estimates and shedding over 4.5% in early trading. Given that there are 170 companies reporting this week, there is sure to be more wild swings for individual names. Also in the spotlight today was the Federal Reserve two-day policy meeting starting today, with an announcement on measures happening tomorrow. No big announcements are expected, but it is possible they shed some light on their buying programs and how poorly they see the economy going forward. With that, our deep learning algorithms paired with Artificial Intelligence (“AI”) technology have you covered with the Top Shorts today.

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Carter’s Inc (CRI)

First on the Top Short list today is Carter’s Inc CRI , which makes apparel for babies and children under brand names, including Carter’s and OshKosh B’gosh OSK . It sells its products primarily through three channels: branded retail stores in the United States and Canada, company websites, and department stores and other wholesale locations. Our AI algorithms have identified factor scores of F in Technical, F in Growth, D in Momentum Volatility, and C in Quality Value for the stock that is down 20.16% for the year already. Revenue was $3519.29M in the last fiscal year compared to $3400.5M three years ago. Operating Income was $401.73M in the last fiscal year versus $419.25M three years ago. EPS was $5.85 in the last fiscal year, worse than the $6.24 three years ago. ROE was 30.16% in the last year which compares to 36.81% three years ago. Forward 12M Revenue is expected to grow by 10.0% and the stock is trading with a forward 12M P/E of 14.48.

Cedar Fair LP (FUN)

Cedar Fair LP is next on the Top Short list today from our deep learning algorithms, with factor scores of D in Technical, D in Growth, D in Momentum Volatility, and F in Quality Value. The stock has lost 52.37% for the year already, but our AI thinks the path is lower from here. The company operates amusement park-resorts located in various states across USA and Canada. All their parks have facilities for people from all age groups as well as exciting rides and attractions. However, during a pandemic the demand for these services is likely to be lower. Revenue grew by 10.56% over the last three fiscal years to $1474.92M in the last fiscal year, compared to $1321.97M three years ago. Operating Income grew by 3.26% over the last three fiscal years to $320.92M in the last fiscal, which compares to $306.06M three years ago. EPS was $3.03 in the last fiscal year versus$3.79 three years ago. ROE was 1535.55% in the last year, which compares to 300.39% three years ago.

Bank OZK (OZK)

Another Top Short today is Bank OZK, a bank holding company that owns and operates a community bank, Bank of the Ozarks. The bank operates offices primarily in the southeastern United States, as well as Texas, New York, and California. Factor scores from our AI systems have been identified as F in Technical, F in Growth, D in Momentum Volatility, and C in Quality Value. The stock has lost 22.95% year-to-date. Revenue was $962.27M in the last fiscal year compared to $912.76M three years ago. Operating Income was $561.14M in the last fiscal year, which is lower than the $580.09M three years ago. EPS was $3.3 in the last fiscal year versus $3.35 three years ago. ROE was 10.75% in the last year, not improving on the 13.48% three years ago. Forward 12M Revenue is expected to grow by 0.63% and the stock is trading with a forward 12M P/E of 10.25.

Regions Financial Corp (RF)

Second last on our Top Short list today is Regions Financial Corp RF , a regional bank headquartered in Alabama, with branches primarily in the Southeastern and Midwestern United States. Regions primarily provides traditional commercial and retail banking and offers mortgage services, asset management, wealth management, securities brokerage, insurance, and trust services. Our AI systems have identified factor scores of D in Technical, D in Growth, D in Momentum Volatility, and C in Quality Value for the stock that has lost 37.92% for the year already. Revenue was $5516.0M in the last fiscal year and compares to $5425.0M three years ago. Operating Income was $2030.0M in the last fiscal year which is below the $1891.0M three years ago. EPS was $1.5 in the last fiscal year compared to $1.0 three years ago. ROE was 10.08% in the last year which is slightly better than the 7.55% three years ago. The stock is trading with a forward 12M P/E of 8.97.

Western Digital Corp (WDC)

Our final Top Short today is Western Digital Corp WDC with factor scores from our deep learning algorithms of D in Technical, C in Growth, D in Momentum Volatility, and D in Quality Value. The stock is down 33.36% for the year already, but this level looks like a great time to get short, according to our AI systems. The company is a leader in the hard disk drive and flash markets. The company develops, manufactures, and provides data storage solutions to consumers, businesses, and governments. EPS lost -22.24% in the last fiscal year and came in at negative $(2.58) in the last fiscal, which compares to $1.34 three years ago. Revenue was $16569.0M in the last fiscal year versus $19093.0M three years ago. Operating Income was $253.0M in the last fiscal year compared to $2186.0M three years ago. ROE was (7.01%) in the last year, much worse than the 3.52% three years ago. Forward 12M revenue is expected to grow by 3.05% and the stock trades with a forward 12M P/E of 8.17.

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