Even if you believe the market is headed higher, it is in your interest to keep close track of stocks that are showing signs of distribution and deteriorating on a fundamental basis. Savvy investors will consider reducing the size of their position in stocks that have been downgraded in the POWR Ratings, and more aggressive traders may consider shorting these stocks.
Without further ado, let’s take a look at three stocks recently downgraded in the POWR Ratings: Greenlane Holdings (GNLN), Integrated Media Technology Limited (IMTE), and Summit Hotel Properties (INN).
Greenlane Holdings (GNLN)
GNLN certainly received its fair share of attention as the cannabis sector took off in previous months. However, if you take a look at the company’s news, you won’t find many recent updates. GNLN makes money by distributing vaporization productions along with consumption accessories throughout North America. GNLN customers range from cannabis dispensaries to cannabis processors and cultivators. GNLN also owns its own D2C e-commerce sites through which its vaporization and related products are sold.
GNLN has an F in the Quality component of the POWR Ratings along with Ds in the Sentiment, Value, and Stability components. Click here to learn more about how GNLN fares in the remainder of the POWR Ratings components such as Momentum and Growth.
Of the 11 publicly traded companies in the Tobacco segment, GNLN is ranked dead last. The Tobacco industry as a whole has an A POWR Rating grade. Click here to learn more about the stocks in the Tobacco segment.
GNLN is not grouped with other cannabis stocks as the companies do not actually deal with the cannabis plant. Rather, “flowers” are used in GNLN vaporizers and other products. However, vaporizers have been placed under the microscope as there are legitimate questions as to whether these devices are as healthy for “flower” consumption as claimed.
In terms of price returns, GNLN has a one-month price return of -4% and a three-month price return of 1.32%. Now that some investors are taking cannabis-related profits off the table following the overarching industry’s considerable upward run, it might be time to cut GNLN loose.
Integrated Media Technology Limited (IMTE)
Based in Wanchai, Hong Kong, IMTE’s specialty is three-dimensional presentations. In fact, IMTE technology even converts two-dimensional objects into three dimensions. Though IMTE’s tech will certainly prove useful in the context of advertising in the years ahead, the stock is not worthy of your investing dollars at the current moment.
IMTE has F grades in the Quality, Value, and Stability components of the POWR Ratings. Click here to learn more about how IMTE grades out in the Sentiment, Growth, and Momentum components.
Of the 44 publicly traded companies in the Technology – Electronics space, IMTE is ranked 43rd. Click here to learn more about the stocks in the Technology – Electronics sector. IMTE has a one-month price return of -20%. The stock’s price return in 2020 was -57%.
Summit Hotel Properties (INN)
INN is a real estate investment trust or REIT for short. This REIT owns select-service hotels with premium brand names. The company’s target customer demographics are those in the upper-middle class and upper class. INN has an F grade in the Quality and Growth components of the POWR Ratings along with a D Sentiment grade. Click here to find out how INN fares in the Momentum, Value, and Stability components of the POWR Ratings.
Of the 22 stocks in the REITs – Hotel space, INN is ranked 18th. You can find out more about the publicly traded companies in the REITs – Hotel segment by clicking here.
INN is overpriced. The stock is trading about a dollar below its 52-week high of $11.32. However, INN has a sky-high forward P/E ratio of 86.23. Keep in mind, there is some question as to whether the economy will fully reopen. About one-third of the general public in the United States is refusing the coronavirus vaccination. Furthermore, if variations of the virus arise that vaccinations cannot defeat, people will be that much more hesitant to spend time at INN properties.
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GNLN shares were trading at $4.57 per share on Tuesday afternoon, down $0.24 (-4.99%). Year-to-date, GNLN has gained 15.40%, versus a 12.11% rise in the benchmark S&P 500 index during the same period.
About the Author: Patrick Ryan
Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management. More...
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|INN||Get Rating||Get Rating||Get Rating|