This year, the stock market posted the worst first half in more than 50 years. Moreover, the Consumer Price Index (CPI) accelerated 9.1% year-over-year in June, exceeding the 8.8% Dow Jones estimate. Therefore, the Fed is expected to increase the benchmark interest rates even more aggressively, exacerbating recession risks.
Furthermore, U.S. business activity declined in July for the first time in nearly two years, pressured by a sharp slowdown in the service sector, painting a gloomy picture for the economy. The U.S. Composite PMI Output index plunged more than expected to 47.5 this month, compared to a final reading of 52.3 in June.
While the stock market managed to stage a rally last week despite Friday’s losses, Steve Sosnick, Chief Strategist at Interactive Brokers, suggested not to be fooled by short bear market rallies. He added that the bearish market is expected to persist longer and decline further if the Federal Reserve remains in its monetary policy position.
As some analysts are forecasting an economic slowdown in the months ahead, it could be wise to avoid fundamentally weak stocks Invesco Ltd. (IVZ), Kymera Therapeutics, Inc. (KYMR), Mogo Inc. (MOGO), and Sana Biotechnology, Inc. (SANA). Our proprietary POWR Ratings system has recently downgraded these stocks to Strong Sell or Sell.
Invesco Ltd. (IVZ)
IVZ is an independent investment management firm. It provides its services to retail clients, institutional clients, high-net-worth clients, public entities, unions, corporations, non-profit organizations, financial institutions, pension funds, and sovereign wealth funds. The company manages separate client-focused equity and fixed income portfolios.
IVZ’s operating revenues decreased 1.8% year-over-year to $1.63 billion in the fiscal 2021 first quarter ended March 31, 2022. The company’s adjusted operating income amounted to $494.60 million, down 1.7% from the year-ago value. Its adjusted net income attributable to IVZ and adjusted EPS came in at $259.30 million and $0.56, registering a decline of 18.1% and 17.6% year-over-year, respectively.
Analysts expect IVZ’s earnings per share to decline 29.6% from the last year to $2.17 for the fiscal year 2022 (ending December 2022). Also, its current year’s $4.74 billion consensus revenue estimate represents a 9.9% year-over-year decline.
The stock has declined 31.9% over the past nine months and 25.7% year-to-date to close the last trading session at $17.11.
IVZ’s POWR Ratings are consistent with this bleak outlook. The company has an overall rating of D, which translates to a Sell in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
IVZ has a grade of F for Sentiment. It has a D grade for Growth and Quality. Within the D-rated Asset Management industry, it is ranked #52 of 61 stocks. Click here to see IVZ’s POWR Rating for Momentum, Value, and Stability.
Kymera Therapeutics, Inc. (KYMR)
KYMR is a biopharmaceutical company focusing on discovering and developing novel small molecule therapeutics that selectively degrade disease-causing proteins by harnessing the body’s natural protein degradation system. The company engages in developing the IRAK4 program, IRAKIMiD program, MDM2 program, and STAT3 program.
In the fiscal 2022 first quarter ended March 31, 2022, KYMR’s collaboration revenue from related parties declined 48.6% year-over-year to $9.62 million. Its operating expenses increased 46.1% from the year-ago value to $46.56 million. Its loss from operations widened 180.5% year-over-year to $39.93 million.
In addition, the company’s net loss and loss per share attributable to common stockholders came in at $36.68 million and $0.71, worsening 180.6% and 144.8% from the prior-year period, respectively.
The consensus revenue estimate of $14.69 million for the fiscal 2022 second quarter ended June 2022 represents a 20.7% decline from the same period last year. The consensus loss per share estimate of $0.71 for the to-be-reported quarter represents a widening of 29.7% year-over-year. Furthermore, the company has missed the consensus revenue estimates in three of the trailing four quarters.
The stock has declined 65.8% year-to-date and 62.2% over the past year to close the last trading session at $21.71.
KYMR’s POWR Ratings reflect this poor outlook. The stock’s overall F rating equates to a Strong Sell in our proprietary rating system.
KYMR has an F grade for Sentiment and a D for Growth, Value, Momentum, Quality, and Stability. Within the F-rated Biotech industry, it is ranked #389 of 404 stocks. Click here to get access to POWR Ratings for KYMR.
Mogo Inc. (MOGO)
Headquartered in Vancouver, Canada, MOGO operates as a financial technology company. It provides digital solutions to consumers to control their financial health. The company offers the Mogo app to access a digital spending account with Mogo Visa Platinum Prepaid Card, MogoCrypto, which enables the buying and selling of bitcoin, and MogoMoney, which provides access to personal loans.
In the fiscal 2022 first quarter ended March 31, 2022, MOGO’s operating expenses increased 79% year-over-year to C$24.65 million ($19.08 million). Its loss from operations worsened by 186.8% from the year-ago value to C$5.50 million ($4.26 million), compared with an adjusted EBITDA loss of C$1.10 million ($851,510) in the prior-year period.
Furthermore, MOGO’s net loss widened 89.5% year-over-year to C$18.87 million ($14.61 million). Its net loss per share came in at C$0.25, worsening 316.7% year-over-year. As of March 31, 2022, the company’s cash and cash equivalents stood at C$53.86 million ($41.69 million) versus C$69.21 million ($53.58 million) as of December 31, 2021.
Analysts expect MOGO’s loss per share to widen 7.3% from the prior-year period to $0.12 for the fiscal 2022 third quarter (ending September 2022). Furthermore, the consensus loss per share estimate for the current year (ending December 2022) is expected to come in at $0.45, worsening 8.4% year-over-year.
MOGO’s shares have plunged 82.4% over the past year to close the last trading session at $1.03.
MOGO’s POWR Ratings are consistent with this bleak outlook. The stock’s overall D rating translates to a Sell in our proprietary rating system.
MOGO has a D grade for Growth and Quality. Within the D-rated Asset Management industry, it is ranked #61 of 61 stocks. Click here to see additional POWR Ratings (Momentum, Stability, Value, and Sentiment) for MOGO.
Sana Biotechnology, Inc. (SANA)
SANA is a biotechnology company that focuses on utilizing engineered cells as medicines. The company develops ex vivo and in vivo cell engineering platforms for various therapeutic areas with unmet treatment needs. Its product candidates include SG295 and SG242 targeting CD19+ cancer cells, SG221 and SG239 treating multiple myeloma, and SG418 treating sickle cell disease.
SANA’s loss from operations came in at $31.69 million in the fiscal 2022 first quarter ended March 31, 2022. The company’s non-GAAP net loss and non-GAAP net loss per share amounted to $86.89 million and $0.47, worsening 62.2% and 4.4% year-over-year, respectively. Furthermore, its non-GAAP operating cash burn stood at $81.95 million, up 67.8% from the prior-year period.
The $0.56 consensus loss per share estimate for the fiscal 2022 third quarter (ending September 2022) represents a 22.2% widening from the same period in 2021. In addition, analysts expect SANA’s loss per share of $0.77 for the fourth quarter (ending December 2022) to decline 29.1% year-over-year.
The stock has slumped 51.8% year-to-date and 59.4% over the past year to close the last trading session at $7.46.
SANA’s POWR Ratings reflect its poor prospects. The stock has an overall D rating, equating to a Sell in our proprietary rating system.
SANA has a D grade for Value, Quality, Growth, and Momentum. Within the F-rated Biotech industry, it is ranked #379 of 404 stocks. To see SANA’s POWR Ratings for Growth and Momentum, click here.
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IVZ shares were trading at $17.17 per share on Monday afternoon, up $0.06 (+0.35%). Year-to-date, IVZ has declined -24.08%, versus a -16.19% rise in the benchmark S&P 500 index during the same period.
About the Author: Mangeet Kaur Bouns
Mangeet’s keen interest in the stock market led her to become an investment researcher and financial journalist. Using her fundamental approach to analyzing stocks, Mangeet’s looks to help retail investors understand the underlying factors before making investment decisions. More...
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|KYMR||Get Rating||Get Rating||Get Rating|
|MOGO||Get Rating||Get Rating||Get Rating|
|SANA||Get Rating||Get Rating||Get Rating|