Top Stocks To Short Today As Dow Drops F0llowing Apple Earnings

The Dow fell over 100 points on Friday, despite massive earnings beats from big tech companies. Amazon AMZN , Apple, and Facebook all reported better than expected quarterly results, despite a global slowdown from a pandemic. Pushing the market lower was a few major headlines, including the expiry of emergency benefits from the Federal Government, which is not set to renew amid negotiations that seem to be far apart, at best, between Democrats and Republicans. Chevron CVX also fell more than 4%, pushing the Dow lower, citing “significantly reduced demand” in the second quarter. Finally, falling consumer sentiment readings caused some concern, as the University of Michigan’s consumer sentiment index came in at 72.5 for July, down from 78.1 in June, and missing estimates of 72.7. If you think that the market has gotten ahead of itself, our deep learning algorithms paired with Artificial Intelligence (“AI”) technology has identified several Top Shorts today.

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American Express Co (AXP)

First on the Top Short list today is financial services giant American Express Co AXP . The company is a global financial institution, operating in about 130 countries, that provides consumers and businesses charge and credit card payment products. The company operates a highly profitable merchant payment network. Since 2018, the company has operated in three segments: global consumer services, global commercial services, and global merchant and network services. Our AI systems have given factor scores of D in Technical, F in Growth, D in Momentum Volatility, and D in Quality Value for the stock that is already down 24.79% year-to-date. Revenue grew by 1.15% over the last three fiscal years to $39983.0M in the last fiscal year, compared to $33872.0M three years ago. EPS grew by 62.61% over the last three fiscal years to $7.99 in the last fiscal year in comparison to $2.99 three years ago. Operating Income was $8591.0M in the last fiscal year versus $7503.0M three years ago. ROE was 29.8% in the last year, much higher than the 14.18% three years ago. Forward 12M revenue is expected to grow by 2.66% and the stock is trading with a forward 12M P/E of 17.38.

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Carnival Corporation & Plc (CCL)

Next on the Top Short list is Carnival Corporation & Plc, the largest global cruise company, with more than 100 ships on the seas at the end of 2019. Its portfolio of brands includes Carnival Cruise Lines, Holland America, Princess Cruises, and Seabourn in North America; P&O Cruises and Cunard Line in the United Kingdom; Aida in Germany; Costa Cruises in Southern Europe; and P&O Cruises in Australia. Our deep learning algorithms have assigned factor scores of C in Technical, D in Growth, F in Momentum Volatility, and D in Quality Value to the stock that has lost 72.05% for the year already. Downside momentum looks to continue for the struggling travel company. Revenue was $20825.0M in the last fiscal year versus $17510.0M three years ago. Operating Income was $3277.0M in the last fiscal year, which compares to $3237.0M three years ago. EPS was $4.32 in the last fiscal year, compared to $3.59 three years ago. ROE was 12.01% in the last year, about flat compared to 11.13% three years ago.

Cullen/Frost Bankers Inc (CFR)

Cullen/Frost Bankers Inc is next on the Top Short list today with AI-based factor scores of F in Technical, D in Growth, C in Momentum Volatility, and C in Quality Value. The stock has lost 24.78% for the year, but momentum is clearly to the downside here longer-term. The company is a financial holding company, headquartered in San Antonio. One of the 50 largest U.S. banks, Frost provides a wide range of banking, investments, and insurance services to businesses and individuals across Texas in the Austin, Corpus Christi, Dallas, Fort Worth, Houston, Permian Basin, Rio Grande Valley, and San Antonio regions. As for the financials, revenue grew by 6.72% over the last three fiscal years to $1334.15M in the last fiscal, compared to $1167.43M three years ago. EPS grew by 0.97% over the last three fiscal years to $6.86 in the last fiscal, versus $5.51 three years ago. Operating Income was $510.76M in the last fiscal year, which compares to $430.19M three years ago. ROE was 12.19% in the last year, which compares to 11.56% three years ago. The stock is currently trading with a forward 12M P/E of 17.47.

Continental Resources Inc (CLR)

Continental Resources Inc also is rated a Top Short today with factor scores of D in Technical, F in Growth, D in Momentum Volatility, and C in Quality Value from our AI systems. The stock has lost 49.25% for the year already. The company is a U.S. oil and gas producer targeting in the Bakken Shale in North Dakota and the Scoop/Stack plays in Oklahoma. At the end of 2019, the company reported net proven reserves of 1.6 billion barrels of oil equivalent. As for the financials, revenue grew by 41.64% over the last three fiscal years to $4224.88M in the last fiscal, which compares to $2820.9M three years ago. Operating Income grew by 108.01% over the last three fiscal years to $1256.88M in the last fiscal year, compared to $453.88M three years ago. EPS was $2.08 in the last fiscal year versus $2.11 three years ago. ROE was 11.45% in the last year, worse than the 16.74% three years ago.

Nordstrom Inc (JWN)

Our final Top Short today is Nordstrom Inc with factor scores of C in Technical, F in Growth, F in Momentum Volatility, and F in Quality Value for the stock that has lost 65.2% for the year already. The company is a fashion retailer that operates approximately 116 department stores in the U.S. and Canada and approximately 240 outlet stores under the names Nordstrom Rack JWN and Last Chance. Revenue was $15524.0M in the last fiscal year, which compares to $15478.0M three years ago. Operating Income was $816.0M in the last fiscal year, versus $926.0M three years ago. EPS was $3.18 in the last fiscal year, better than the $2.59 three years ago. ROE was 53.56% in the last year, compared to 47.32% three years ago. Forward 12M Revenue is expected to grow by 7.49%.

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