Each week Forcerank runs a variety of games covering different industries. What we have found, is that the lowest ranked companies in their respective games deliver the biggest negative price movement and vice versa for those in the top position. This week we look at a list of companies that are consistently at the bottom or trending lower in their respective games. To receive the rest of the rankings, visit the Forcerank Blog or sign up for next week's contests and we will send you the consensus data Monday morning.
Amazon (NASDAQ:AMZN) | Hardware: It's difficult to imagine Amazon on a list of losers regardless of what the situation might be but this week Forcerank users dropped the retailers avg ranking from 1.7 to 4.1. Amazon still ranks highly in the hardware contest but such a large drop in average ranking signals near term volatility. At $760 per share some investors have grown concerned that Amazon can't sustain trading at 175 times TTM earnings. The stock also took a beating recently following Trump's shocking election victory. Amazon's CEO, Jeff Bezos, and President Elect Trump haven't seen eye to eye but the main concern is how Trump approaches trade policy. Any restrictive tariffs or embargoes will put pressure on Amazon's operations around the world. From a technical standpoint the recent losing streak spurred a bearish crossover in the MACD along with the 50 day moving average eclipsing the short term 20 day average.
Chipotle Mexican Grill (NYSE:CMG) | Restaurants: Unlike Amazon, Chipotle has a home on the list of weekly losers. The burrito chain continues to suffer from its many health outbreaks that started over a year ago. Meanwhile, the fast casual space has become increasingly crowded with newcomers like Shake Shack and lesser known private companies. The stock should continue to see greater downside risk if it can't correct underlying business fundamentals. A technical breakdown also points to weak price action including a MACD on the verge of a bearish crossover and relatively soft volume growth.
Skyworks Solutions (NASDAQ:SWKS) | Semiconductors: Shares of the chipmaker have soared in recent months following the early success of the new iPhone 7. Now that consumers and the market is less enamored with the phone it's time for Skyworks to return its gains. A bearish crossover of the 20 day average along with the MACD inching closer to negative territory and its own bearish crossover intimates a downturn on the horizon. Forcerank users consistently rank Skyworks in the middle of the semiconductors contest despite some glaring weaknesses in its charts.
Yelp (NYSE:YELP) | Social Media: Early this week one analyst at Macquarie reiterated a buy rating on Yelp citing greater monetization possibilities through advertising and paid leads. Forcerank users, on the other hand, don't share Macquarie's optimistic and have ranked Yelp at the bottom of this week's social media contest. At one point Yelp was a clear leader in the business review space but Facebook's (NASDAQ:FB) emergence in the space, along with other heavy hitters, poses a serious threat to its business fundamentals. Investors should also be concerned about Yelp's over inflated valuation. At about $37 per share, the stock is trading at over 50 times forward earnings, a tough value to justify given its recent struggles.
Ctrip (NASDAQ:CTRP) | Ecommerce: Travel services in China are expected to be one of the fastest growing industries in the region but that hasn't helped Ctrip investors. The stock is down 10% in the past 3 months on a number of weak earnings reports. In two of the past 3 quarters the Chinese travel agency posted a quarterly loss over 15 cents per share. Shares still continue to trade at 105 times future earnings, a difficult measure to justify given its weak underlying fundamentals. In addition to weak financial performance, Ctrip operates in an increasingly competitive space that includes Alibaba (NYSE:BABA) and Baidu (NASDAQ:BIDU).
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.