Top Stocks To Short Today As Dow Slips Amid Big Tech Rally

Markets were mixed this morning as the S&P 500 and the tech-heavy Nasdaq NDAQ rose slightly, while the Dow Jones was trading lower. Amazon AMZN was in the news this morning and was gaining about 1% on the day after Reuters reported that the delivery giant wants a minority stake in a cloud company called Rackspace Technology, possibly to add to their AWS software base. Lingering coronavirus stimulus negotiations in Congress, in addition to U.S. and China tensions, are keeping a lid on the market for now, which looks overbought at these levels. If you’re looking for places to short the market, our deep learning algorithms have used Artificial Intelligence (“AI”) technology to identify the Top Shorts today.

Sign up for the free Forbes AI Investor newsletter here to join an exclusive AI investing community and get premium investing ideas before markets open.

Alliance Data Systems Corp (ADS)

First on the Top Short list today is Alliance Data Systems Corp ADS with AI-based factor scores of C in Technical, D in Growth, F in Momentum Volatility, and D in Quality Value. The company was a combination of a J.C. Penney transaction-processing operation and The Limited’s credit card bank business. The stock has not done well this year, already down 57.47% for the year. Revenue was $5581.3M in the last fiscal year, which compares to $5474.7M three years ago. Operating Income was $1058.4M in the last fiscal year, better than the to $1228.3M three years ago. EPS was $5.46 in the last fiscal year, much lower than the $14.1 three years ago. ROE was 29.21% in the last year versus 43.79% three years ago. The stock is currently trading with a forward 12M P/E of 6.13.

Recommended For You

Cardlytics Inc (CDLX)

Next on the Top Short list is Cardlytics Inc after the stock has gained 31.91% for the year. Our AI systems think this will not continue, and has identified factor scores of D in Technical, D in Growth, D in Momentum Volatility, and F in Quality Value. The company operates an advertising platform within financial institutions digital channels, which include online, mobile, email and various real-time notifications. Revenue grew by 52.99% over the last three fiscal years to $210.43M in the last fiscal year, compared to $130.36M three years ago. EPS shrank by -81.51% over the last three fiscal years to $(0.72) in the last fiscal, compared to $(7.86) three years ago. Operating Income was $(17.32)M in the last fiscal year versus $(17.1)M three years ago. ROE was (17.56%) in the last year. Forward 12M Revenue is expected to grow by 19.19%.

CIT Group Inc (CIT)

Third on the Top Short list today is CIT Group Inc CIT with our deep learning algorithms assigning factor scores of C in Technical, F in Growth, F in Momentum Volatility, and F in Quality Value. Unfortunately for investors, the stock is down 54.25% for the year, but our AI systems thinks it is still an opportune time to get short the stock. The company is a banking holding company and a financial holding company operating primarily in North America. As for the financials, revenue was $2228.9M in the last fiscal year, which compares to $2375.9M three years ago. Operating Income was $641.5M in the last fiscal year versus $721.2M three years ago. EPS was $5.28 in the last fiscal year, better than the $2.79 three years ago. ROE was 8.62% in the last year versus 2.99% three years ago. Forward 12M Revenue is expected to grow by 0.59% and the stock is trading with a forward 12M P/E of 21.4.

Sabre Corp (SABR)

Another Top Short today is Sabre Corp SABR with AI-based factor scores of C in Technical, F in Growth, D in Momentum Volatility, C in Quality Value. The company holds the number-two share of global distribution system air bookings (38.8% as of the end of 2019 versus 37.1% in 2018). The global distribution system segment represented 73% of total 2019 revenue. The company also has a growing IT solutions division (27% of revenue) that focuses on the airline, hospitality, and travel agent end markets. Of course, the stock has lost 64.57% for the year as the global pandemic crushes the tourism industry. Revenue was $3974.99M in the last fiscal year, which compares to $3598.48M three years ago. Operating Income was $379.88M in the last fiscal year versus $563.02M three years ago. EPS was $0.57 in the last fiscal year, less than the $0.87 three years ago. ROE was 17.1% in the last year, about half of the 37.7% three years ago. Forward 12M Revenue is expected to grow by 26.12%.

Six Flags Entertainment Corp (SIX)

Our Final Top Short today has not had a fun ride this year, already losing 53.06% in price, but our AI systems thinks the momentum will continue to the downside. Six Flags Entertainment Corp is the company, which owns and operates theme parks worldwide. It operates around 25 theme parks and waterparks, 22 are in the United States, two are located in Mexico and one is located in Montreal, Canada. The parks generally offer various rides, water attractions, themed areas, concerts, restaurants, game venues, and merchandise outlets. The financials are going to look much different in the next year, but revenue was $1487.58M in the last fiscal year, which compares to $1359.07M three years ago. Operating Income was $436.25M in the last fiscal year, versus $469.41M three years ago. EPS was $2.11 in the last fiscal year, less than the $3.09 three years ago. ROE was 216.85% three years ago but will likely come down massively in the next fiscal year. Forward 12M Revenue is expected to grow by 66.0% if things go well, however it looks suspect at this point.

Liked what you read? Sign up for our free Forbes AI Investor Newsletter here to get AI driven investing ideas weekly. For a limited time, subscribers can join an exclusive slack group to get these ideas before markets open.

Comments are closed.