7 F-Rated Stocks to Kick to the Curb in October
If you’re holding F-rated stocks in your portfolio, I’ve got one question for you.
Why?
Why would you subject your portfolio and your financial future to F-rated stocks that are more likely to drag your earnings down than build them up?
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As we cruise through October and the first part of the fourth quarter, it’s time to start thinking about portfolio maintenance and getting your holdings ready for year-end and 2024.
With so many quality A-rated stocks out there, it seems to be a waste to keep your F-rated stocks around any longer.
The Portfolio Grader evaluates all stocks on an “A” through “F” scale, giving top marks to the stocks that have the best earnings history, growth, momentum, analyst sentiment and other factors.
And the ones at the bottom of the scale are F-rated stocks.
Here are just a few F-rated stocks. If you’re holding any of these names, it’s high time to kick them to the curb.
Blink Charging (BLNK)
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Blink Charging (NASDAQ:BLNK) designs, manufactures, owns and operates charging stations for electric vehicles.
The company has contracted, sold or deployed nearly 78,000 charging ports. It has a variety of options for potential hosts—hybrid-owned, Blink-owned, host-owned or Blink as a service.
Either way, you would think that this is a solid opportunity, particularly since Deloitte predicts global EV sales could reach 31.1 million by 2030. But remember Blink’s share of this pie is tiny, and it threatens to be overwhelmed by Tesla (NASDAQ:TSLA). That’s why it’s one of the F-rated stocks to stay away from.
Second-quarter revenue was only $24.5 million. Tesla, meanwhile, had nearly $25 billion in revenue in the quarter, with $2.1 billion of that coming from its services segment that includes its charging stations.
And it’s also notable that former CEO Michael Farkas sold 1.4 million shares of Blink Charging stock and purchased zero in the last year. In fact, there’s only been one insider purchase of BLNK shares in the last year and 25 sales.
Those in the know are dumping BLNK. It gets an “F” rating in the Portfolio Grader.
Li-Cycle Holdings (LICY)
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Li-Cycle Holdings (NYSE:LICY) is a Canadian company that recycles lithium-ion batteries. That seems like, on the surface, to be a great business to get into because the demand for lithium-ion batteries is ever-growing with the widespread use of electronics, toys, headphones, power tools and EVs.
The company has four manufacturing facilities and is expanding its factories in North America and Europe, but it’s spending far more than it takes in and the financial picture is getting worse by the month.
The net income loss shows consistent growth and that’s not growth that investors want to see. In the second quarter, it reached $35.3 million.
Meanwhile, operating expenses jumped from $33.3 million in Q2 2022 to $46.1 million in Q2 2023. The company’s cash fell to $288.8 million from $517.9 million a year ago.
LICY stock is down more than 30% this year. It gets an “F” rating in the Portfolio Grader.
Express (EXPR)
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Fashion retailer Express (NYSE:EXPR) caters to young men and women. But the stock is definitely out of fashion as we head into the fourth quarter.
Express is lacking in revenues, earnings in Q2 were down 6% from a year ago at $434.3 million. It’s laying off 150 workers to reduce expenses and plans to reduce other expenses by $200 million by 2025.
Then there’s the stock price. EXPR stock is down 58% this year, and the company had to resort to a 1-for-20 reverse stock split in August to make the share price look better and stay within New York Stock Exchange listing requirements.
EXPR stock gets an “F” rating in the Portfolio Grader.
Plug Power (PLUG)
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There were a lot of high hopes for Plug Power (NASDAQ:PLUG), which is a bet on the development of hydrogen fuel cells. But Plug Power has failed to live up to its lofty expectations, which is why the stock is down 89% from its 2021 highs, and 48% this year.
Simply put, Plug Power’s ambitions are greater than its ability to make hydrogen fuel cells profitable. It still hasn’t completed construction of its hydrogen production plant in Georgia.
Its net earnings loss jumped in Q2 to $236.3 million from $173.2 million a year ago. And its cost of revenue climbed to $338.3 million from $183.7 million.
I’ll concede that the idea of a profitable hydrogen fuel cell sounds great. But if you’re holding on to this stock waiting for riches, you’re going to be sorely disappointed this month.
PLUG stock gets an “F” rating in the Portfolio Grader.
Grom Social Enterprises (GROM)
Source: Shutterstock
Grom Social Enterprises (NASDAQ:GROM) is a social media, entertainment and technology company that caters to kids.
The internet can be a cesspool and even dangerous for kids, so Grom provides what it calls “safe” media for kids younger than 13.
I get that kids want their own space. But TikTok is a lot more appealing to kids and a lot more popular. So it’s going to be difficult for Grom to scale its business and get a sizable piece of that audience.
Revenue in Q2 was $956,000, down 16% from a year ago. The company posted a net loss of $2.21 million in the quarter.
Grom also completed a 1-for-20 stock split this year to try to prop up the stock price, but shares are already down to less than $2.
GROM stock is down 93% this year and it gets an “F” rating in the Portfolio Grader.
Mullen Automotive (MULN)
Source: Ringo Chiu / Shutterstock.com
Fans of the 2004 film Mean Girls will remember antagonist Regina George snapping at embattled friend Gretchen Weiner, “Stop trying to make ‘fetch’ happen! It’s not going to happen.”
I feel the same way about Mullen Automotive (NASDAQ:MULN). It’s not going to happen.
Mullen Automotive wants to be the next great EV company, selling crossovers, sports cars, pickups and commercial vehicles. But it’s slow going. Mullen doesn’t count deliveries by the thousands or hundreds. It issues news releases when it delivers as few as 10 vehicles.
Earnings in the fiscal third quarter ending June 30 included revenue of $308,000. But with a total operating expense of $53.8 million, the losses were massive. The loss per share came in at $11.14.
Mullen also executed a 1-for-9 reverse stock split and sued some dealer brokers alleging they unfairly manipulated the MULN stock price. Mullen also is appealing a delisting notice from Nasdaq as the stock price fell below $1 per share again despite the reverse split.
MULN stock is down 93% this year. It gets an “F” rating in the Portfolio Grader.
Pfizer (PFE)
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Pfizer (NYSE:PFE) researches, develops and produces vaccines and medicines. It’s one of the world’s best-known pharmaceutical companies, becoming a household name for winning the race to develop a Covid-19 vaccine.
Now the race is on to develop a vaccine that immunizes patients against Covid-19 and the flu at the same time. It also, along with partner BioNTech, received approval from U.S. regulators for its updated Covid-19 vaccine for the current strain.
This is important work, but it’s not as lucrative as it used to be. The U.S. government isn’t automatically buying Covid-19 vaccinations any longer, so the demand has dropped significantly from a year ago.
So has Pfizer’s earnings. Second-quarter numbers showed revenue down more than 54% at 12.7% and net income down 77% to $2.33 billion.
Pfizer is putting some of its hopes into its weight-loss candidate danuglipron, which would be a competitor to Ozempic. And Pfizer has a deep well of candidates in its pipeline.
But this company has much different prospects than it did during the pandemic, and the stock performance (down 35% this year) reflects that reality.
PFE stock has an “F” rating in the Portfolio Grader.
On the date of publication, Louis Navellier did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
The InvestorPlace Research Staff member primarily responsible for this article had a long position in TSLA. The staff member did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
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