3 Popular Nasdaq 100 Stocks to Avoid Right Now

NASDAQ: AMD | Advanced Micro Devices Inc. News, Ratings, and Charts

AMD – The Fed is expected to maintain its hawkish stance despite easing inflation numbers, which might impede the performance of the Nasdaq 100. Moreover, given the rising recession fears, it could be wise to avoid popular yet fundamentally weak Nasdaq 100 stocks, Advanced Micro Devices (AMD), Blackstone (BX), and BlackRock (BLK) now. Read on to know more….

The Fed launched two back-to-back 75 bps rate hikes in June and July and is likely to maintain its hawkish stance in the September meeting as well, despite easing inflation.

Victoria Fernandez, the chief market strategist at Crossmark Global Investments, said, “For me, there’s not enough evidence for the Fed to make a huge pivot from where they are. I still think they’re considering 50, 75 basis points at the September meeting.”

Such extended monetary tightening might mar the performance of the interest rate-sensitive Nasdaq 100, which has lost 16.3% year-to-date. Moreover, lingering macroeconomic headwinds are concerning. According to Statista, there is a 5.9% probability that the United States will fall into another recession by June 2023, up from a previous estimate of 4.1%.

Furthermore, JPMorgan Chase CEO Jamie Dimon recently projected that there is a 20% to 30% chance of a “harder recession” and a similar chance of “something worse.”

Given the near-term uncertainties, we think it might be best to avoid popular Nasdaq 100 stocks Advanced Micro Devices, Inc. (AMD), Blackstone Inc. (BX), and BlackRock, Inc. (BLK) at this hour, considering their declining financials.

Advanced Micro Devices, Inc. (AMD)

AMD operates as a semiconductor company worldwide. The company has two segments- Computing and Graphics; and Enterprise, Embedded, and Semi-Custom. It serves original equipment manufacturers, public cloud service providers, original design manufacturers, system integrators, independent distributors, online retailers, and add-in-board manufacturers.

AMD’s net revenue increased 70.1% year-over-year to $6.55 billion for the second quarter ended June 25, 2022. However, its operating income came in at $526 million, down 36.7% year-over-year. Also, its net income came in at $447 million, down 37% year-over-year, while its EPS decreased 53.4% year-over-year to $0.27.

AMD’s forward EV/S of 6.12x is 95.7% higher than the industry average of 3.12x, while its forward P/S of 6.22x is 100% higher than the industry average of 3.12x.

The stock has lost 29.8% year-to-date to close the last trading session at $101.01.

AMD’s POWR Ratings reflect its poor prospects. It has an overall grade of D, which indicates a Sell in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.

Also, the stock has a D grade for Stability. Click here to access the additional POWR Ratings for AMD (Growth, Value, Momentum, Sentiment, and Quality). AMD is ranked #85 out of 95 stocks in the Semiconductor & Wireless Chip industry.

Blackstone Inc. (BX)

BX is an alternative asset management firm specializing in real estate, private equity, hedge fund solutions, credit, secondary funds of funds, public debt and equity, and multi-asset class strategies. It invests in early-stage companies and also provides capital markets services.

On August 9, 2022, BX’s subsidiaries completed the acquisition of all of the outstanding shares of American Campus Communities, Inc., the largest developer, owner, and manager of high-quality student housing communities in the United States.

Also, on July 20, 2022, BX’s affiliates completed the acquisition of all of the outstanding shares of PS Business Parks, Inc. However, these acquisitions might strain its already deteriorating financials.

BX’s total revenues decreased 88.1% year-over-year to $629.22 million for the 2022 second quarter. Its net loss came in at $29.39 million, compared to a net income of $1.31 billion in the year-ago period. Moreover, its loss per share came in at $0.04 compared to an EPS of $1.82 in the prior-year period.

BX’s forward P/S of 5.73x is 89.9% higher than the industry average of 3.02x. Its forward P/Book of 14.91x is significantly higher than the industry average of 1.23x.

BX’s revenue is expected to decline 32.6% year-over-year to $3.01 billion for the quarter ended December 2022. Its EPS is expected to decrease 33.9% year-over-year to $1.13 for the same period. The stock has lost 16% year-to-date to close the last trading session at $108.68.

BX has an overall D grade, equating to Sell in our POWR Ratings system. Also, it has a D grade for Growth, Value, Stability, and Sentiment.

Click here to access the BX ratings for Momentum and Quality. It is ranked #29 out of 36 stocks in the F-rated Private Equity industry. 

BlackRock, Inc. (BLK)

BLK is a publicly owned investment manager. The firm primarily provides services to institutional, intermediary, and individual investors. The firm employs liquidity, asset allocation, balanced, real estate, and alternative strategies to make its investments.

For the second quarter ended June 30, 2022, BLK’s total revenue decreased 6.1% year-over-year to $4.53 billion. Its net income came in at $1.08 billion, down 21.8% year-over-year. The company’s EPS came in at $7.06, down 20.9% year-over-year.

BLK’s forward EV/S of 6.42x is 122.5% higher than the industry average of 2.89x. Its forward P/S of 6.23x is 106.6% higher than the industry average of 3.02x.

Street expects BLK’s revenue to decrease 13.7% year-over-year to $4.36 billion for the quarter ended September 2022. Its EPS is expected to decline 26% year-over-year to $8.10 for the same period. The stock has lost 17.5% year-to-date to close the last trading session at $755.82.

BLK’s POWR Ratings are consistent with this bleak outlook. The stock has a D grade for Growth and Value.

We also have graded BLK for Momentum, Stability, Sentiment, and Quality. Click here to access all of BLK’s ratings. It is ranked #48 out of 60 stocks in the D-rated Asset Management industry.

AMD shares were trading at $100.91 per share on Tuesday morning, down $0.10 (-0.10%). Year-to-date, AMD has declined -29.87%, versus a -9.15% rise in the benchmark S&P 500 index during the same period.

About the Author: Riddhima Chakraborty

Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master's degree in economics, she helps investors make informed investment decisions through her insightful commentaries. More...

More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
AMDGet RatingGet RatingGet Rating
BXGet RatingGet RatingGet Rating
BLKGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com

2024 Stock Market Outlook

The time to think about the 2024 stock market is now. Will it be a bull or bear? Where does the S&P 500 (SPY) end the year? And what are the top picks to outperform? Investment veteran Steve Reitmeister does his level best to answer all these questions. Just read on below...

3 Stocks Bringing AI to the Masses

Like it or not, large companies with a combination of cash and massive databases do have an advantage in the new AI world. These three companies are wielding that advantage to get a leg up in the rapidly changing AI landscape. Keep a close eye on how these companies, Meta (META), Alphabet (GOOGL) and Yelp (YELP) continue to take advantage of their respective incumbencies to shape the consumer’s interaction with AI.

With Oil Soaring, My Under $10 Stock of the Week

The number of oil rigs in the U.S. and Canada has decreased by 170 over the past year. International oil suppliers are cutting output. This opens the door to small oil and gas exploration and development companies like Baytex Energy (BTE).

Income Stock of the Week: Manhattan Bridge Capital (LOAN)

In the current high mortgage rate environment, and with financial instability growing in the commercial real estate market, you want to be extra diligent when investing in mortgage lenders. This lender has a sterling track record of providing short term loans to those needing some quick extra cash. And Manhattan Bridge Capital (LOAN) is rewarding investors with a hefty dividend.

Stock Market vs. Bond Rate Relationship Revealed

The stock market is affected by many things like the Fed and the economy. However, there is not enough talk about how the movement of bond rates makes stocks more or less attractive. Like how the S&P 500 (SPY) is having a terrible September as bond rates explode higher. Learn more about this dynamic relationship and what it means for stock prices in the days ahead.

Read More Stories

More Advanced Micro Devices Inc. (AMD) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All AMD News