U.S. equities are shifting lower on Wednesday as Wall Street becomes increasingly irritated with a lack of firm progress in U.S.-China trade talks. The latest chatter is that President Trump, who often uses the stock market as a barometer of his on-the-job performance, is thinking of backing a weaker trade deal in order to juice equity prices higher. He may do this rather than risk a breakdown in talks, impose new tariffs and try to extract a better agreement.
Certainly, the relative performance of U.S. stocks vs. Chinese equities in recent weeks suggest traders think Beijing has the leverage right now. The S&P 500 has stalled near the 2,800 level, while the Shanghai Composite has soared.
With doubts creeping in, a number of more speculative tech stocks are starting to feel the heat. Tesla (NASDAQ:TSLA) is chief among them, amid a weak reception from another announced price cut to the Model 3, a decision to close nearly all physical stores and increased competition from Chinese competitors like Nio (NYSE:NIO).
Here’s a deeper look at TSLA stock, along with three other tech stocks to sell now:
TSLA stock is falling out of a four-month consolidation range, testing lows not seen since October. This marks a drop of more than 25% from its December highs. Headlines have been brutal lately, from CEO Elon Musk tussling with the Securities and Exchange Commission again over his tweets to reports China has suspended Model 3 customs for improper labeling. The next big catalyst will be the Model Y compact SUV unveiling scheduled for Mar. 14. The fear is that the vehicle will cannibalize sales of the Model 3.
The company will next report results on May 1 after the close. Analysts are looking at a loss of 36 cents per share on revenues of $7.3 billion. When the company last reported on Jan. 30, earnings of $1.93 missed estimates by 9 cents per share on a 119.8% rise in revenues.
Twitter (NYSE:TWTR) shares remain relegated to a long trading range going back to late July, where TWTR stock is unable to decisively break up and over its 200-day moving average. Accusations of political bias continue to linger, with company CEO Jack Dorsey appearing on the popular Joe Rogan podcast where he was forced to defend the company’s actions in a multi-hour interview.
The company will next report results on May 9 before the bell. Analysts are looking for earnings of 5 cents per share on revenues of $773.3 million. When the company last reported on Feb. 7, earnings of 31 cents per share beat estimates by 7 cents on a 24.2% rise in revenues.
HP Inc. (HPQ)
HP Inc. (NYSE:HPQ) shares have been slaughtered in recent weeks, suffering a 20% decline from their late February high after the company reported earnings. The dip fully reversed the December-February rally in HPQ stock. Investors seemed to be concerned about flat printing revenue and a downgrade from Bank of America Merrill Lynch analysts.
The company will next report results on May 29 after the close. Analysts are looking for earnings of 51 cents per share on revenues of just over $14 billion. When the company last reported on Feb. 27, earnings of 52 cents per share matched estimates on a 1.3% rise in revenues.
Fitbit (NYSE:FIT) shares are threatening to fall through their 200-day moving average, down more than 14% from their recent highs. FIT stock has been unable to cross above the uptrend channel resistance that has been in play since last summer. Analysts at Wedbush recently downgraded shares as it continues to struggle amid the dominance of Apple (NASDAQ:AAPL) and its Apple Watch.
The company will next report results on May 29 after the close. Analysts are looking for a loss of 29 cents per share. When the company last reported on Feb. 27 earnings of 14 cents per share beat estimates by 7 cents on a 0.1% rise in revenues.
As of this writing, William Roth did not hold a position in any of the aforementioned securities.
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