Don't Let Their High-Volume Fool You. 3 Active Stocks to Avoid Right Now

NASDAQ: PLUG | Plug Power, Inc. News, Ratings, and Charts

PLUG – Despite the slower pace of payroll gains in August, market uncertainty is expected to continue as the Fed is expected to put more weight on the upcoming CPI data. Amid this backdrop, high-volume trading of Plug Power (PLUG), SoFi Technologies (SOFI), and Peloton Interactive (PTON) may not indicate anything positive about them. Given their poor growth prospects, these stocks are best avoided right now. Read on to learn more….

The August jobs report showed that the economy added 315,000 jobs, and the unemployment rate rose to 3.7%. Despite the slower pace of payroll gains in August, analysts expect the Fed to remain as hawkish as it sounded at the Jackson Hole conference. The Fed is expected to put more weight on the upcoming CPI data.

Furthermore, the deepening yield curve inversion is raising recessionary concerns. Also, geopolitical tensions between China and Taiwan may exacerbate the market’s trouble.

According to renowned investor Jeremy Grantham, the U.S. stock market is still an unheard-of “superbubble” that will bring financial “tragedy” to investors when it bursts. He further added that the current financial crisis is entering its “final act” due to the deteriorating state of the economy.

Since concerns about the Fed’s potential rate hikes are expected to keep the market volatile, fundamentally weak stocks Plug Power Inc. (PLUG), SoFi Technologies Inc. (SOFI), and Peloton Interactive Inc. (PTON) are best avoided now despite their high-volume trading.

Plug Power Inc. (PLUG)

PLUG provides end-to-end clean hydrogen and zero-emissions fuel cell solutions for supply chain and logistics applications, on-road electric vehicles, the stationary power market, and others in North America and internationally. PLUG has traded at an average trading volume of 22.3 million over the past three months.

During the second quarter ended June 30, 2022, PLUG’s net revenue increased 21.5% year-over-year to $151.27 million. However, its operating loss grew 63.9% from the year-ago value to $146.91 million. The company’s net income increased 73.9% year-over-year to $173.29 million.

Analysts expect PLUG’s EPS to decline at the rate of 40% per annum over the next five years. The stock has declined 26.6% over the past nine months and 4.6% year-to-date.

PLUG’s POWR Ratings are consistent with this bleak outlook. The stock has an overall rating of F, which translates to a Strong Sell in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.

PLUG has been graded an F for Stability, Quality, and Sentiment. Within the C-rated Industrial – Equipment industry, it is ranked #86 of 92 stocks. To see additional POWR Ratings for Growth, Value, and Momentum for PLUG, click here.

SoFi Technologies Inc. (SOFI)

SOFI offers digital financial services. Lending; Technology Platforms; and Financial Services are the three operational segments of the company. The company’s lending, financial services, and products enable its members to borrow, save, spend, invest and protect their money. The stock has traded at an average volume of 39.78 million over the past three months.

SOFI’s revenue increased 56.8% year-over-year to $362.53 million for the second quarter ended June 30, 2022. However, its net loss came in at $95.84 million, while its loss per share amounted to $0.12. In addition, its net income margin, ROE, and ROA are negative at 28.5%, 8.3%, and 2.7%, respectively.

The stock has declined 26.6% over the past nine months.

SOFI’s weak fundamentals are reflected in its POWR Ratings. The stock has an overall F rating, equating to a Strong Sell in our proprietary rating system. The stock has an F grade for Stability and Quality and a D for Sentiment. In the F-rated Financial Services (Enterprise) industry, it is ranked #107 of 108 stocks.

In addition to the POWR Ratings grades I have just highlighted, you can see the SOFI ratings for Momentum, Growth, and Value here.

Peloton Interactive Inc. (PTON)

PTON sells interactive fitness products in North America and worldwide. Under the brand names Peloton Bike, Peloton Bike+, Peloton Tread, and Peloton Tread+, it provides connected fitness products with touchscreens that stream live and on-demand classes.

The company markets and sells interactive fitness products through its retail showrooms and online at PTON has traded at an average trading volume of 14.65 million over the past three months.

For the fourth quarter ended June 30, 2022, PTON’s revenue declined 27.6% year-over-year to $678.7 million. Its operating loss surged 298.6% from the prior-year quarter to $1.20 billion, while its net loss increased 297.3% year-over-year to $1.24 billion. Its loss per share came in at $3.68.

The company’s EPS is expected to decline at the rate of 76.5% per annum over the next five years. Analysts expect its revenue to decline 14.4% year-over-year to $3.07 billion in fiscal 2023. The stock has declined 89.7% over the past year and 71.3% year-to-date.

PTON’s poor prospects are also apparent in its POWR Ratings. The stock has an overall F rating, which equates to a Strong Sell in our proprietary rating system.

It also has an F grade for Sentiment and a D for Stability and Quality. PTON is ranked #57 of 59 stocks in the C-rated Consumer Goods industry. Click here to see the additional POWR Ratings for PTON (Momentum, Value, and Growth).

PLUG shares rose $0.03 (+0.12%) in after-hours trading Friday. Year-to-date, PLUG has declined -8.36%, versus a -16.80% rise in the benchmark S&P 500 index during the same period.

About the Author: Pragya Pandey

Pragya is an equity research analyst and financial journalist with a passion for investing. In college she majored in finance and is currently pursuing the CFA program and is a Level II candidate. More...

More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
PLUGGet RatingGet RatingGet Rating
SOFIGet RatingGet RatingGet Rating
PTONGet RatingGet RatingGet Rating

Most Popular Stories on

What is Jay Soloff's Stock of the Week?

Applying AI to their business products is where companies can gain an edge in the AI race. eGain (EGAN) is doing just that, and revitalizing its customer knowledge business in the process. Let's take a look at this stock that just released its latest earnings.

Why the Bull Market is Still in Charge?

It’s been nearly 2 months that the S&P 500 (SPY) has been mired in a trading range. That is why investment veteran Steve Reitmeister shares his latest insights to explain why a bull market is still in place...and how to target the best stocks and ETFs for the days ahead. Read on for the full story below...

3 Biotechs with Massive Growth Potential

These three biotech stocks have massive growth opportunities on the horizon, and could add a huge boost to any portfolio. They play in some of the most in demand markets on the planet, and have track records of finding ways to introduce products into those markets to capture big profits. Novo Nordisk (NVO), Regeneron (REGN) and Corcept Therapeutics (CORT) are deserving of a very close look right now.

1 Income Stock to BANK ON Now

One of the best ways to address risk is through diversity. With a strong balance sheet and solid earnings KB Financial (KB) provides a diverse option in the banking sector, with international exposure to mitigate some of the risk we’ve seen in U.S. banking this year.

The ODD Story Behind Thursday’s BIG Stock Rally

We have all been worried about what high inflation will do to the economy and stock market. And yet on Thursday inflation spiked again, yet amazingly the S&P 500 (SPY) had a great session. Investment veteran Steve Reitmeister shares the reasons why in his new market outlook with trading plan and top picks. Read on below for more...

Read More Stories

More Plug Power, Inc. (PLUG) News View All

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