Too Far, Too Fast: These Stocks Set to Fall After Hot 2023 Starts
The S&P 500 is heading for another positive week, following its strongest January performance since 2019. However, analysts believe some stocks are gaining momentum and set to fall. On Thursday afternoon, the broad stock index was up more than 2% for the week. The Nasdaq Composite jumped almost 5%, while the Dow Jones Industrial Average hovered around the flat line. Investor optimism that the Federal Reserve will soon ease monetary policy fueled the rise in major indices, although Chairman Jerome Powell said it was “premature” to declare victory on inflation. The rally in tech stocks has also contributed to benchmark gains in 2023. For example, Meta shares jumped nearly 30% this week, up sharply after the social media company released a quarterly earnings pace. . Shares are up more than 60% for the year. Still, analysts don’t expect many stocks to maintain their early-year momentum, warning that investors are overly optimistic about the Fed’s stance on inflation. We used FactSet data to filter out S&P 500 stocks whose consensus price targets indicate an expected decline. Here are 20 stocks that analysts say will see the biggest declines this year. Prices are in effect Thursday morning: Entertainment giant Paramount surged to start the year, up 44% year-to-date Thursday morning. On Monday, CNBC announced that the company is integrating its streaming service, Paramount+, into its Showtime TV network. However, analysts anticipate a drop of 22.6% this year. Macquarie downgraded Paramount shares to underperform from neutral the day after Paramount announced its integration plans. Another addition to the list – used-vehicle retailer CarMax – has gained around 25% in 2023. However, JPMorgan recently downgraded its shares, saying investors are not fully pricing in the company’s risks. Analysts predict that CarMax shares will drop 19.6% from their current level. Carnival Cruise Line’s stock jumped more than 40% in 2023 Thursday morning, but analysts predict it will fall 8.1%. Although analysts believe 2023 will be a “record year” for the cruise industry as a whole, Morgan Stanley has downgraded shares of the cruise liner, expecting another year of losses for the company. Meanwhile, Citigroup reiterated its neutral but high risk rating. Shares of CH Robinson gained 11.5% in 2023, but analysts predict they will fall more than 8%. The freight company released its quarterly results earlier this week. CH Robinson’s earnings and revenue were below analysts’ expectations, according to Refinitiv. The company has been struggling with reduced volume and freight prices due to lower consumer spending and lower shipping volumes. – CNBC’s Michael Bloom contributed to this story.
Too Far, Too Fast: These Stocks Set to Fall After Hot 2023 Starts
