Each week Trifecta Stocks identifies names that look bearish and may present interesting investing opportunities on the short side.
Using technical analysis of the charts of those stocks, and, when appropriate, recent actions and grades from TheStreet's Quant Ratings, we zero in on five names.
While we will not be weighing in with fundamental analysis, we hope this piece will give investors interested in stocks on the way down a good starting point to do further homework on the names.
Sunrun
Sunrun Inc. (RUN) recently was downgraded to Sell with a D rating by TheStreet's Quant Ratings.
This maker of residential solar energy system was a hot one last fall and finished the year strong, but heavy distribution and poor price action are the characteristics of Sunrun's chart today. The recent fall has been on big turnover, which tells us the big institutions are getting out of the way.
Money flow is bearish and the Relative Strength Index (RSI) shows a steep downward slope. Double Moving Average Convergence Divergence (MACD) sell signals, too. It doesn't get worse than that, so put in a short to ride this down to $37, and a stop in place at $65.
Plug Power
Plug Power Inc. (PLUG) recently was downgraded to Sell with a D rating by TheStreet's Quant Ratings.
With the excitement over electric vehicles this hydrogen fuel cell stock has been a firecracker. Plug Power has been around for years, but it is the recent trends that really got this company some good exposure.
The stock was driven from single digits up to the $70s, but now it's coming back down to earth -- fast. MACD crossed for a sell signal late in January and the stock started tanking hard. Notice the bearish money flow and how the stock easily broke the 50-day moving average downward.
The 200-day moving average is up near $23; that's an easy target. But put in a stop at $50 just in case.
This commentary is an excerpt from "5 Bearish Bets" a weekly feature sent to subscribers of Trifecta Stocks. Click here to learn more about this portfolio, trading ideas and market commentary product.
Want to find out the other stocks we think look good short this week and how to play them? Click here for a trial subscription to Trifecta Stocks and get "Bearish Bets" each week!
-- Bob Lang and Chris Versace are co-portfolio managers of Trifecta Stocks.
