Picture this: You're scrolling through your phone, trying to make sense of the stock market. Charts, numbers, and expert opinions blur together like a financial smoothie. Sound familiar? Welcome to investing in 2024, where data overload is the new normal. But here's the thing - buried in that avalanche of information are golden nuggets that could supercharge your portfolio. And that’s where FINQ comes into play to cut through the noise.
Since August 24, 2022, FINQ's FINQLAST portfolio has been making waves in the investment world with its daily updated list of prime short-selling candidates.
While the S&P 500 Short Index experienced a significant decline of -30.27%, FINQLAST users celebrated a 16.68% gain. This performance highlights the effectiveness of FINQ's short-selling strategy. Instead of shorting the entire S&P 500, which can result in losses during a bull market, FINQ strategically shorts only the bottom 10 stocks. This focused approach enables FINQLAST to potentially generate positive returns even when the overall market is trending upwards, though there are cases where the market loses and FINQLAST experiences smaller losses.
Leveraging advanced AI, FINQ analyzes millions of data points to uncover trends that human analysts might miss. For example, last quarter, STOCKS-AI identified a 4.79% gain on CVS from May 22 to June 3, 2024, while the broader market dipped -0.445%. Additionally, it detected a 5.92% increase in Netflix stock in just 8 days (May 16 to May 24, 2024), when the market only rose by 0.144%. Stay tuned as we delve deeper into how FINQ is transforming investing, empowering you to make informed and confident decisions.
Market overview
The U.S. stock market kicked off 2024 on a high note, with the S&P 500 gaining 10%. Investors brushed aside mixed economic signals and set their sights on a brighter horizon featuring potential interest rate cuts and accelerated earnings growth later this year. Yet, beneath this optimistic surface, caution persisted with inflation proving more resilient than many had hoped. Where do we stand now?
Highs, lows, and steady gains
In May alone, the S&P climbed 4.2% despite some worries about the economy slowing down and consumer confidence dipping. This reflects a broader trend of strong earnings and optimism overriding any fears. In fact, the S&P 500 recently hit its 30th record close of the year, the Dow breached the 40,000 level for the first time, and the Nasdaq experienced a streak of five consecutive record closes in just one week in mid-June.
The global perspective
Internationally, according to the World Bank's latest Global Economic Prospects report, 2024 could be a potential turning point with the global economy stabilizing for the first time in three years. However, tempering this stability are projections of modest global growth, pegged at 2.6% for the year, inching slightly higher to an average of 2.7% between 2025 and 2026. This global backdrop influences market sentiments and strategies as investors weigh recovery prospects against ongoing economic uncertainties globally.
FINQLAST portfolio overview
Feel overwhelmed by the unpredictability in the stock market? Look no further than FINQLAST for a fresh, daily perspective on the ten stocks poised for downturns and showing potential as short-selling opportunities. Here's what powers this approach behind the scenes.
The science behind FINQLAST's daily updates
The pioneering STOCKS-AI technology powers FINQLAST's daily portfolio updates. The system rummages through the S&P 500 daily with a blend of artificial intelligence and scientific rigor.
By processing vast datasets, our unique AI-based STOCKS-AI ranking system generates a daily full S&P ranking (1-500) and compiles a portfolio (FINQLAST) of 10 stocks that consistently rank at the bottom, making them most suitable for short-selling. This portfolio provides clear and simplified insights on what to sell short, what to close short (buy) in its place, when, and how much. Ideal for hedging or anticipating market downturns, it offers strategic knowledge for navigating overpriced markets and protecting assets. FINQLAST handles the complex analysis, empowering investors to make informed decisions confidently without wading through detailed reports or second-guessing instincts.
Criteria for stock selection: a trio of three insights
FINQLAST's daily updated short-sell list is based on three core insights: Professional Wisdom, Crowd Wisdom, and Fundamentals. STOCKS-AI processes thousands of analyst reports daily to capture expert perspectives. It also monitors social media and forums to gauge broader market sentiment, reflecting Crowd Wisdom. Lastly, it performs in-depth analysis of the latest earnings and financial reports, ensuring each selected stock is firmly grounded in fundamental financial data.
Comparative performance: FINQLAST vs S&P500
So with that said, how does FINQLAST stack up against the broader market? Here's a straightforward comparison of FINQLAST’s portfolio against the S&P 500 Short Index, showcasing its knack for pinpointing high-risk stocks ripe for short-selling.
- Long-term growth: Since launching on August 25, 2022, FINQLAST has gained 16.33%. Meanwhile, the S&P 500 Short Index has seen a significant downturn, dropping by -30.25%.
- Year-to-date performance: As of June 25, 2024, FINQLAST has a decrease of -0.27% this year, outshining the S&P 500 Short, which has declined by -15.32%.
- Recent performance: FINQLAST had a slight decline of -0.01%, while the S&P 500 experienced a modest gain of 0.07%.
Bottom-ranked stocks analysis by FINQ
Now, as Q2 2024 wraps up, let’s take a detailed look at FINQLAST's top five short-selling opportunities. We will review each stock and explore its financial health, market position, and potential future risks.
1. Loews Corp. (L)
Loews Corp presents an intriguing case for potential shorting. As of the first quarter of 2024, Loews saw its net sales dip to $21.364 billion from $22.347 billion year-over-year, with net earnings at $1.755 billion, representing 8.21% of sales. The company's cost structure reflects a tightened profit margin, with 66.81% of sales attributed to the cost of goods sold and an operating income that makes up 12.42% of net sales. Despite a market position of 1,746 stores and a significant footprint in the home improvement sector, Lowe’s is bracing for a 2% to 3% drop in sales in 2024. Furthermore, Lowe's faces numerous external risks ranging from economic downturns and labor shortages to geopolitical tensions and natural disasters, which could significantly impact its operations and market value.
Loews’s FINQ rank
On August 22, 2023, Loews ranked with a Professional Wisdom score of 0/100, Crowd Wisdom of 82/100, and Fundamentals at 67/100. As of June, 25, 2024, its Professional Wisdom score remains at 0, and its Crowd Wisdom score has also dropped to 0. However, it now has a perfect Fundamentals score of 100/100.
2. Davita Inc (DVA)
DaVita presents a compelling case for potential shorting due to its mixed financial health and operational risks. In Q1 2024, it reported revenues of $3.071 billion and an operating income of $484 million. Yet, it faced a troubling negative operating cash flow of $135 million and a substantial free cash flow deficit of $327 million. As the largest U.S. provider of dialysis services, controlling over 35% of the market and operating over 3,000 facilities worldwide, DaVita heavily relies on government payers, with commercial insurers bolstering most profits from just 10% of treated patients. Further clouding the company's future are operational delays from the Change Healthcare outage, increased borrowing, and macroeconomic uncertainties. Regulatory changes around ESG standards and challenges in its commercialization strategy further amplify its risks.
Davita’s FINQ rank
On October 11, 2023, DaVita had a Professional Wisdom score of 32/100, Crowd Wisdom score of 70/100, and Fundamentals score of 0/100. As of June 25, 2024, it has a Professional Wisdom score of 2/100, a Crowd Wisdom score of 50/100, and a Fundamentals score of 33/100.
3. Viatris Inc (VTRS)
Viatris may have marked its fourth consecutive quarter of revenue growth after reporting Q1 2024 revenues of $3.66 billion and adjusted EBITDA of $1.19 billion. However, as a global healthcare entity that merges generics with branded products, it has several indicators and challenges that could make it a viable candidate for shorting. Risks include achieving synergies from strategic initiatives, the potential fallout from public health crises, regulatory changes, retention of key personnel, and funding issues. Moreover, risks related to new product launches, clinical trial outcomes, manufacturing issues, and ongoing legal matters could significantly affect its operational efficiency and market position.
Viatris’ FINQ rank
On August 22, 2023, Viatris had a Professional Wisdom score of 27/100, Crowd Wisdom score of 40/100, and Fundamentals score of 0/100. As of June 25, 2024,, it has a Professional Wisdom score of 20/100, a Crowd Wisdom score of 50/100, and a Fundamentals score of 0/100.
4. Fastenal Co (FAST)
Fastenal Co, a key player in the wholesale distribution of industrial and construction supplies, reported a slight sales increase of 1.9% to $1,895.1 million for the first quarter of 2024, with a net income of $297.7 million. Yet despite these solid figures, the stock holds potential as a short target due to underlying vulnerabilities and market conditions. The company’s operating income was $390.2 million, representing 20.6% of net sales. Still, its cost management and future growth prospects raise concerns. Fastenal is also facing gross margin pressures and challenges in maintaining its historical growth rate, exacerbated by a 4.4% decline in fastener product line sales due to soft industrial production and negative pricing effects. Furthermore, upcoming investments and the operational costs associated with expanding customer service capabilities could squeeze operating margins by about 30 basis points in the upcoming quarter.
Fastenal’s FINQ rank
On April 10, 2024, Fastenal had a Professional Wisdom score of 25/100, Crowd Wisdom score of 10/100, and Fundamentals score of 0/100. As of June 25, 2024, it has a Professional Wisdom score of 22/100, a Crowd Wisdom score of 16/100, and a Fundamentals score of 0/100.
5. Allegion PLC (ALLE)
Allegion PLC's financial health dipped slightly in Q1 2024, with revenues falling to $893.9 million, a 3.2% decrease, and adjusted net earnings dropping by 1.9% to $136.9 million. While the company, a leader in security products, maintains a strong market position and has executed strategic acquisitions like Boss Door Controls and Dorcas, its future has challenges. Various uncontrollable factors, including market trends and competition, could disrupt its operations. Furthermore, the reliance on potentially inaccurate assumptions for its optimistic revenue growth forecast of 1.5% to 3.5% for the full year might pose a risk.
Allegion’s FINQ rank
On February 16, 2024, Allegion’s had a Professional Wisdom score of 31/100, Crowd Wisdom score of 28/100, and Fundamentals score of 100/100. As of June 25, 2024, it has a Professional Wisdom score of 17/100, a Crowd Wisdom score of 20/100, and a Fundamentals score of 67/100.
Honorable mentions
6. Snap-On Inc (SNA)
On April 1, 2023, Snap-On had a Professional Wisdom score of 29/100, Crowd Wisdom score of 56/100, and Fundamentals score of 0/100. As of June 25, 2024, it has a Professional Wisdom score of 24/100, a Crowd Wisdom score of 8/100, and a Fundamentals score of 0/100.
7. CBRE Group Inc (CBRE)
On June 26, 2024, CBRE had a Professional Wisdom score of 0/100, Crowd Wisdom score of 37/100, and Fundamentals score of 100/100. As of June 25, 2024, it has a Professional Wisdom score of 4/100, a Crowd Wisdom score of 20/100, and a Fundamentals score of 33/100.
8. Mettler-Toledo International Inc (MTD)
On December 11, 2022, Mettler-Toledo had a Professional Wisdom score of 0/100, Crowd Wisdom score of 9/100, and Fundamentals score of 0/100. As of June 25, 2024, it has a Professional Wisdom score of 4/100, a Crowd Wisdom score of 66/100, and a Fundamentals score of 0/100.
9. Amcor PLC (AMCR)
On August 21, 2023, Amcor had a Professional Wisdom score of 26/100, Crowd Wisdom score of 48/100, and Fundamentals score of 100/100. As of June 25, 2024, it has a Professional Wisdom score of 26/100, a Crowd Wisdom score of 44/100, and a Fundamentals score of 0/100.
10. Juniper Networks, Inc. (JNPR)
On May 28, 2024, Juniper had a Professional Wisdom score of 24/100, Crowd Wisdom score of 8/100, and Fundamentals score of 0/100. As of June 25, 2024, it has a Professional Wisdom score of 28/100, a Crowd Wisdom score of 42/100, and a Fundamentals score of 0/100.
Final words
FINQ's FINQLAST can be your secret weapon in the stock market battlefield. By crunching millions of data points daily, it spots potential short-selling opportunities that human eyes might miss. The results speak for themselves: while the S&P 500 Short Index stumbled, FINQLAST users saw gains in both the long-term, medium-term, and short-term.
But remember, even the smartest AI is just a tool. The real power lies in combining FINQ's insights with your knowledge and instincts. Stay curious, keep learning, and don't be afraid to dive into the data. By blending cutting-edge tech with good old-fashioned research, you're setting yourself up for smarter, more confident investing. So why not give FINQ a shot? Your future self (and your wallet) might thank you.
