Top 4 Consumer Stocks That May Fall Off A Cliff In Q4
Portfolio Pulse from Lisa Levin
The article identifies four consumer discretionary stocks that are considered overbought based on their Relative Strength Index (RSI) values, which are above 70, suggesting a potential short-term decline. VIZIO Holding Corp. (VZIO), Legacy Housing Corporation (LEGH), Light & Wonder, Inc. (LNW), and Meritage Homes Corporation (MTH) have all shown strong recent performance but may face a pullback due to their high RSI readings.
November 13, 2023 | 12:54 pm
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NEGATIVE IMPACT
Legacy Housing Corporation exceeded Q3 earnings expectations and has an RSI of 82.84, potentially indicating an upcoming short-term price drop.
The stock's RSI value significantly above 70 suggests that LEGH might see a price retraction as the market digests its recent rapid appreciation.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 90
NEGATIVE IMPACT
Light & Wonder, Inc. reported strong Q3 revenue growth with an RSI of 81.61, hinting at a possible short-term price correction.
LNW's overbought status, as indicated by its high RSI, may lead to a sell-off as investors might perceive the recent price surge as unsustainable.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 90
NEGATIVE IMPACT
Meritage Homes Corporation's better-than-expected Q3 results are overshadowed by an RSI of 71.95, suggesting a potential near-term downturn.
MTH's RSI just above the overbought threshold may lead to a price correction as the stock could be due for a breather after its recent climb.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 90
NEGATIVE IMPACT
VIZIO Holding Corp. reported strong Q3 sales and has a high RSI of 81.88, indicating an overbought condition that could lead to a short-term price decline.
VIZIO's high RSI suggests the stock may be overextended after its recent gains, which could result in a price correction as traders may consider taking profits.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 90