Seeking out great stocks to buy is important, but identifying quality investments is only half the battle. Many would say it’s even more essential for investors to know which stocks to steer clear of. A losing stock can eat away at your precious long-term returns. So, figuring out which stocks to trim or get rid of is essential for proper portfolio maintenance.
Even the best gardens need pruning and our team has spotted a few stocks that seem like prime candidates for selling or avoiding. Continue reading to find out which three stocks our team is staying away from this week.
Black Hills Corporation (BKH)
Natural gas producer Black Hills Corporation reset its growth outlook lower after reporting disappointing Q4 results, slashing its 2023 EPS view to $3.65-$3.85 from $4.00-$4.20. The revision was driven by a rapid shift in macroeconomic factors, including elevated natural gas price volatility and higher natural gas demand driven by winter storm Elliot in December 2022. With elevated natural gas price volatility, higher interest rates, and general inflationary pressures forecasted through 2024, Black Hills is only expected to grow earnings 2% in 2024 and 4% in 2025.
Uber Technologies (UBER)
Uber shares surged higher immediately following its Feb. 8 earnings call. The ride-share giant reported strong numbers, and management provided an upbeat outlook for the current quarter. However, the stock has already given back some of those gains amid recession concerns. UBER’s current valuation may be overly optimistic about subsequent quarterly results. Another big run may not be in store for the ticker anytime soon.
Opendoor Technologies (OPEN)
Opendoor Technologies (OPEN) aims to revolutionize the home-buying process with its automated solution for a smoother, quicker, and more convenient buying experience. Investors piled into OPEN during its market debut in 2020, However, OPEN stock has lost nearly 80% of its value over the past year, with expectations building that more pain could be on the horizon due to the widespread decline in the real estate market.
Redfin anticipates that there will be a 16% year over year decline in the number of existing home sales in 2023, making OPEN an ideal stock to sell.
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