As the stock market continues to evolve, it’s crucial for investors to stay ahead of the game and make informed decisions. In this comprehensive article, we highlight twelve stocks across various sectors that should be on your radar for potential selling in June.
Firstly, we examine the technology sector, which experienced significant growth during the Covid-19 pandemic but has since faced volatility and underperformance. While some technology stocks have rebounded, not all have fared equally well. We identify three terrible technology stocks that investors should consider divesting due to various factors affecting their performance.
Next, we shift our focus to the oil industry, where caution is warranted due to market dynamics and potential overvaluation. Investing in high-risk oil stocks can lead to increased volatility and uncertainties, impacting overall returns. We highlight three specific high-risk oil stocks that investors may want to sell this month to mitigate potential risks and explore more stable investment alternatives.
Additionally, we delve into the energy sector, which has seen a decline in oil prices and concerns about global demand. As some energy companies grapple with disappointing profits and unfavorable market conditions, we present three sorry energy stocks that should be considered for selling in June before it’s too late.
By providing insights into these twelve stocks across technology, oil, and energy sectors, this article aims to equip investors with valuable information to make informed decisions and protect their portfolios in the ever-changing stock market landscape.
Here are the first 3 Tech Stocks:
Intel (NASDAQ: INTC), once a leading semiconductor company in the US, has seen a notable decline in its fortunes. Despite strong financial performance during the pandemic, with significant profit surges in 2020 and 2021, Intel has struggled with competition and product issues. Falling behind in semiconductor manufacturing, the company faced delays in producing advanced chips, allowing rivals like Advanced Micro Devices (NASDAQ: AMD) to gain market share with more efficient offerings. In an attempt to reverse its situation, Intel has planned investments in US-based chip factories to manufacture chips for itself and other companies. However, manufacturing problems have hindered these plans. Despite beating expectations in Q1, Intel is still viewed as a tech stock to sell by investors.
Agilysys (NASDAQ: AGYS), a provider of point-of-sales and property management software for the hospitality industry, experienced a 12% stock drop following its Q4 2023 earnings report. Despite beating analysts’ expectations and displaying a profitable business model, the company’s announcement of investments across its core businesses for future revenue growth did not sit well with investors. Agilysys had already been trading at a high valuation, with a forward-looking price-to-earnings (P/E) ratio of around 87.4x before the report. This overvaluation, combined with a year-to-date decline of over 6%, positions Agilysys as one of the tech stocks to sell. Investors seeking better returns can explore alternative options within the market.
Logitech (NASDAQ: LOGI), known for its sleek computer mice and keyboards, experienced a significant revenue boost during the Covid-19 pandemic. However, the company’s growth has since declined. In 2022 and 2023, LOGI reported modest revenue growth of 4.36% and a contraction of 17.19%, respectively. Several factors contribute to this decline, including the unsustainable surge in technology usage during remote work in 2020, longer replacement cycles for hardware products like keyboards and mice, and decreased consumer demand for consumer electronics due to global economic conditions. Given the challenging market environment and a year-to-date return of only 0.67%, investors are advised to exercise caution or consider selling Logitech stocks as they fall into the category of tech stocks to sell.
Three Oil Stocks:
APA Corporation (APA)
APA Corporation (NASDAQ: APA), formerly Apache, is facing downward pressure on its shares due to the recent natural gas selloff and investor concerns about its significant debt burden. Despite making substantial debt repayments in recent years, APA’s long-term borrowings remain high, resulting in a debt-to-equity ratio of 8.22 times. However, there is an intriguing development to note. APA, in partnership with TotalEnergies (NYSE: TTE), has successfully drilled and flow tested an appraisal well in Suriname’s offshore area. This achievement in Suriname’s Block 58 is noteworthy, offering a positive outlook amidst the challenges APA encounters in the natural gas market. While the company’s debt burden remains a concern, the Suriname project provides a potential opportunity for APA’s future growth.
Devon Energy Corp. (DVN)
Devon Energy Corp. (NYSE: DVN) is facing a decline in its stock value after a disappointing earnings report. The report included weak forecasts for 2023 production and higher capital expenditures, which have raised concerns about the company’s performance and worth.
Moreover, Devon has provided guidance indicating a temporary increase in capital spending, mainly due to adding a fourth frac crew in the Delaware Basin to compensate for production losses.
Despite offering a high dividend yield of 9.01%, investors should exercise caution. The sustainability of this dividend yield is uncertain as the company has reduced its dividend for three consecutive quarters. The dividend per share dropped from $1.55 in Q3 2022 to $0.72 in Q2 2023, cutting the dividend in half in less than a year. Investors need to carefully consider these factors before making any investment decisions.
ConocoPhillips (NYSE: COP) is facing criticism for its Willow project in Alaska. The Biden administration has finished reviewing the project’s environmental impact, and it could be approved next month. If approved, it would be the largest oil development on public lands in the US.
However, there are concerns about the project. Some people want it to be smaller, which is worrying. The American Petroleum Institute and the US Interior Department also have concerns about Willow.
Because of these concerns, investors should be cautious. They need to think about whether ConocoPhillips is a risky or overpriced oil stock. The project’s uncertain approval and financial success mean investors should be careful.
Three Energy Stocks:
British Petroleum (BP)
In May, British Petroleum (NYSE: BP) saw a 5% drop in its shares. This happened because the company reduced its share buybacks by 36%, going down to $1.75 billion from $2.75 billion. Investors were not happy about this cutback, resulting in only a small 3% increase in BP’s stock in 2023. The company also released quarterly results that were not very impressive to analysts.
Looking closer, BP made a profit of $4.96 billion in Q1, which is 20% less than the $6.20 billion in Q1 2022. During that time, crude oil prices had risen due to Russia’s invasion of Ukraine. Q1 results showed a significant slowdown compared to BP’s previous successful year, where they made a record-breaking profit of $27.7 billion, more than double their profit in 2021.
For now, the dividend remains the same, but the company has stopped increasing it. In February, there was a 10% increase, but it seems those good times are over.
Suncor Energy (SU)
Canada’s Suncor Energy (NYSE: SU) is facing several challenges. In the first quarter, the company’s operating earnings dropped by 34% to $1.81 billion compared to the previous year. Suncor attributed this decline to lower crude oil prices. To reduce costs, the company announced plans to cut 1,500 jobs in June. Additionally, Suncor is under pressure from activist investor Elliott Management, which has acquired a stake in the company. This has led to Suncor being categorized as one of the energy stocks to sell. Despite having a new CEO, Rich Kruger, who aims to improve the company’s financials and stock price, Suncor’s Q1 results did not instill confidence. The company’s upstream production also decreased by 3% compared to the previous year. Overall, SU stock has experienced a 28% decline in the past 12 months.
Devon Energy (DVN)
Devon Energy (NYSE: DVN) is going through a difficult period. The company’s shares have fallen by 13% since the start of the year and have experienced a 35% decline over the past year. Despite offering a significant 8.95% dividend yield, DVN’s stock has been unstable due to decreasing oil prices. The company’s stock took a major hit in February, dropping 12% in a single day, following disappointing Q4 2022 earnings. High capital expenditures, declining production, and shrinking profits have been cited as reasons for selling the stock. Moreover, there is uncertainty surrounding the dividend, as Devon Energy recently reduced the variable portion, leading to speculation about potential future cuts.
Last 3 Sorry Stocks:
Nio (NYSE: NIO) is a Chinese company that makes small electric vehicles and provides charging infrastructure. Founded in 2014, Nio’s stock price has dropped significantly by over 60% in the past year. The company has been facing challenges such as declining sales growth, supply chain issues, lower prices for electric vehicles, and tough competition. In January 2021, NIO’s stock was valued at over $60 per share, but now it has fallen to around $8 per share. Although Nio has seen some growth in deliveries and decent margins, it still faces financial losses and increased competition. Therefore, it’s advisable to avoid investing in Nio stock.
DISH Network (DISH)
DISH Network (NASDAQ: DISH) is a telecommunications company based in Denver, Colorado. They offer pay-TV services, internet, and phone plans. However, traditional cable providers like DISH have been facing challenges as more people switch to streaming services like Netflix and others. In the first quarter, DISH’s net income dropped by more than half compared to the same period last year. They also experienced decreased revenue growth and a decline in the number of customers.
Recently, DISH announced plans to collaborate with Amazon to sell wireless plans through Amazon’s platform. This news led to a 16% increase in DISH’s stock price. While this partnership could be a turning point for the company, I would still be cautious and wait for positive results before considering investing in DISH.
Coinbase (NASDAQ: COIN) is a company based in Wilmington, Delaware that provides financial services for cryptocurrency. Recently, there has been significant news about Coinbase and the collapse of FTX, another major cryptocurrency platform. The Securities and Exchange Commission (SEC) has filed a lawsuit against Coinbase, alleging that the company misled investors and evaded disclosure requirements. The lawsuit claims that Coinbase operated as an intermediary on transactions and traded crypto assets that should have been registered as securities. As a result of the lawsuit, Coinbase’s stock price dropped by 20%. Since its IPO in April 2021, COIN shares have declined by nearly 85%. Given these challenges and the allegations of financial wrongdoing, it is advisable to avoid investing in Coinbase.