In the middle of the turmoil brought on by the coronavirus, it’s hard to think positively. Yet at some point, we will get through this, remembering this moment years from now as one of the darkest chapters in American history. Nevertheless, we shouldn’t be naïve. As I’ve mentioned in prior articles, the novel coronavirus has turned into an econovirus, one that necessitates examining stocks to sell.
Though I’m proud to be a citizen of this country, I’m also a realist. Like all my InvestorPlace colleagues, I firmly believe we will get through this. But contrary to some opinions out there, I think the cost to get back to some semblance of normal will be paradigm shattering. Thus, it’s important to have a cold, rational attitude toward stocks to sell: it’s either you or it’s them.
While President Donald Trump has signed a historic $2 trillion stimulus package into law, do not be fooled: this effort falls far short of what’s actually needed. As you know, several states have issued mandatory stay-at-home orders, including the economic powerhouses of California and New York. Sadly, the latter is America’s Covid-19 epicenter. That in and of itself imposes severe turmoil on our national fiscal stability.
Sure, the stimulus bill overwhelmingly supports individual workers and families in their hour of need. But $1,200 per qualifying adult isn’t going to cut it. According to the Bureau of Labor Statistics, we spent an average of slightly over $20,000 in housing expenditures. That works out to over $1,674 a month, leaving very little for other expenses in a two-adult household.
Put another way, it’s time to consider these “deathwatch” stocks to sell.
Borr Drilling (BORR)
At time of writing, Borr Drilling (NYSE:BORR) is the worst-hit publicly traded company among those whose securities are traded on major exchanges. Just that fact alone should persuade you to put BORR stock in your list of stocks to sell. Following such a catastrophic loss, very few organizations are able to muster a comeback.
Plus, BORR stock has the great misfortune of being levered to one of the worst-hit sectors in this pandemic. Obviously, with millions of Americans forced into their homes, there’s simply no demand. And that’s just back at home. Imagine the turmoil that’s occurring in Europe, particularly Italy and Spain.
On every level, Borr Drilling makes zero sense. Don’t be a hero and just put this into your trash heap of stocks to sell.
In a bull market, Valaris (NYSE:VAL) may have offered an intriguing case. Specializing in offshore drilling, the company utilizes technologically advanced operations. But in a bear market – and especially one brought on by a black swan event – such innovations are liabilities because of overhead costs. Not surprisingly, VAL stock has hemorrhaged over 93% on a year-to-date basis.
While it might seem like I’m picking on the oil sector for my gallery of stocks to sell, what choice do I have? According to an alarming New York Times report, the world is now facing the prospects of “peak storage.” That is, there’s so much oil that we don’t know if we can store it all.
And that means Valaris has zero point existing right now, which makes VAL stock a sell.
Eldorado Resorts (ERI)
If any sector can rival the oil industry in ugliness, it’s the casino business. As you might expect, the stocks to sell in this devastated industry are the lesser-known names like Eldorado Resorts (NASDAQ:ERI). Don’t get me wrong: in any other circumstance, I would support buying ERI stock. But with the econovirus taking no prisoners, Eldorado is one to avoid.
Let’s be real – nobody wants to hang out with strangers right now. And that’s especially the case when you’re all breathing the same circulated air. Plus, casinos are typically high-energy institutions. With all the yelling and commotion, it’s probably very easy to spread infectious diseases.
Obviously, travelers are saying “no thanks” to vacationing in general. In that environment, you need to put ERI stock in your list of stocks to sell.
Chefs’ Warehouse (CHEF)
Like so many names on this compilation of stocks to sell, I have nothing against Chefs’ Warehouse (NASDAQ:CHEF). In terms of growth and profitability, the company has a solid record. As well, I’d say its balance sheet is decent enough (though not great). Therefore, in a bullish environment, I can see myself recommending CHEF stock.
However, with the current crisis, I can’t think of a reason to speculate on CHEF stock. Unfortunately, the underlying business – equipment for restaurants – is exactly what we don’t need. Throughout the country, eateries have closed their doors. Over the next few weeks, many of them will do so permanently.
Even if shares are cheap, you’ll want to sit this out until you get a better read on the consumer economy.
Dave & Buster’s Entertainment (PLAY)
In the time before coronavirus, I’ve suggested buying the dips on Dave & Buster’s Entertainment (NASDAQ:PLAY). Although I hate to go back and reverse course on my idea, I’m left with no choice. Principally, my thesis on PLAY stock involved the psychological concept that we humans are social creatures. But in the post-coronavirus era of social distancing, Dave & Buster’s is a no go.
As with adult gaming venues, the company represents the antithesis of various health agencies’ recommendations. First, you have the same circulated air that you’re breathing. Second, Dave & Buster’s is a socializing platform, mixing people with games, food and drinks.
In other words, it’s a combustible mix for spreading infectious diseases. Thus, you should place PLAY stock in quarantine.
Ruth’s Hospitality Group (RUTH)
Don’t be alarmed! The “hospitality” in Ruth’s Hospitality Group (NASDAQ:RUTH) is exactly what you think it means. Therefore, you can take the significant other – and the kids if you want – without any awkward exchanges.
However, what you should worry about is the incredible decline in RUTH stock. Despite the underlying company’s premium restaurant brand Ruth’s Chris Steak House, few people are willing to go out, let alone dine in an expensive establishment. With so much going on, steakhouses rank well below in the priorities list.
Again, if we were in any other circumstance, I wouldn’t quickly dismiss Ruth’s into the heap of stocks to sell. But in an economic crunch, luxury restaurants are easy to eliminate from the family budget. So, you should probably cancel your reservation for RUTH stock.
Braemar Hotels & Resorts (BHR)
As a real estate investment trust specializing in luxury lodging, Braemar Hotels & Resorts (NYSE:BHR) absolutely requires a strong economy. However, we’re in a bear market facing catastrophic damage to our economy. Indeed, we might return to an America that we don’t recognize. Given that possibility, you need to dump BHR stock.
Honestly, you don’t need to examine the granularity of Braemar. Instead, just pull up charts of publicly traded hotels and resorts. To my knowledge, every one of them would trigger warnings concerning stocks to sell.
If you’re thinking that BHR stock is levered to affluent consumers, you’re right. But as I said earlier, no one is thinking about vacationing right now. Thus, I believe Braemar’s inclusion in this gallery of stocks to sell is well warranted.
Norwegian Cruise Line (NCLH)
Exposed to a sector that faces disheartening, perhaps crippling times ahead, Norwegian Cruise Line (NYSE:NCLH) is an easy inclusion among stocks to sell. In theory, most of us probably appreciate the idea of cruises; principally, getting away from the office and going on a seabound voyage. That is, until someone has a devastating infectious disease.
Then, the narrative becomes less “The Love Boat” and more “Fear the Walking Dead.” If you’re thinking about gambling on NCLH stock, think again.
According to the Washington Post, major cruise liners will not receive stimulus funding. Even if every one of them did, the fiscal support wouldn’t help NCLH stock. Why? I hate to answer a question with a question, but who the heck wants to go on a cruise?
An oil and gas exploration company, Apache (NYSE:APA) is now pointless. Don’t read into this – I’m not trying to be mean. Rather, I’m just speaking plain truths. With crude oil prices falling down into astonishing, agonizing depths, the majors like Exxon Mobil (NYSE:XOM) and Chevron (NYSE:CVX) will encounter severe problems.
For a name like APA stock? If you’re optimistic about it, I applaud your bravery. But bluntly, I don’t understand your argument one bit.
Currently, oil is the most unloved market I can think of. With Russia and Saudi Arabia locked in a price war, the environment is extremely negative for APA stock. Worse yet, no signs exist that the Saudis will let up. Therefore, Apache is simply a no-brainer among stocks to sell.
In the best of times, Groupon (NASDAQ:GRPN) was a speculative bet. During the advent of the internet, GRPN stock may have appealed to investors. However, the underlying business of providing discounts to online consumers is a graying one. After all, it doesn’t take much for organizations to directly market their discounts, given the mass presence of social media.
But now? I think Politico.com said it best in one of their articles about the coronavirus’ economic impact: “Millions of Americans are out of work, most others are slashing their spending and businesses are getting crushed.”
In this paradigm, it doesn’t matter how steep your discounts are – nobody’s buying anything except food and water. Unfortunately, I must relegate GRPN stock into my list of stocks to sell.
Century Casinos (CNTY)
By now, you’ve witnessed me bash casino stocks to sell throughout this gallery. But Century Casinos (NASDAQ:CNTY) might still appeal to you because of its recent technical momentum. Between March 19 and March 25, CNTY stock skyrocketed nearly 177%. Obviously, that’s not a bad profit for a few days’ worth of trading.
Ironically, though, that is the only way to make a profit with CNTY stock – by gambling. Otherwise, from a longer-term outlook, you’ve got to worry about Century Casinos. With locations in diverse places like Colorado, Missouri, and West Virginia, viability post-coronavirus is a problem.
Simply put, the coming recession will disproportionately impact some areas more than others. I used to like this regional diversity. Now, it’s more of a liability.
Even during the bull market – which we all miss right now – fashion retailer Guess (NYSE:GES) was a tricky proposition. Unlike prior generations, millennials have a different way of expressing themselves. When it comes to fashion, they don’t want to be a walking billboard for corporate interests. This lack of superficiality – at least when it comes to clothing – presented challenges for GES stock.
But that challenge has been exacerbated with this econovirus. With multiple “high dollar” states shuttering commerce, Guess misses out on foot traffic and its resultant revenue. Plus, the more important question is this: who cares about fashion in this moment?
Priorities have shifted toward “existential” purchases, which doesn’t favor GES stock. Don’t fight the tape and throw Guess into your pile of stocks to sell.
Granite Point Mortgage Trust (GPMT)
Specializing in commercial mortgage loans, Granite Point Mortgage Trust (NYSE:GPMT) has unsurprisingly suffered tremendously in the markets. At the same time, it’s also not unreasonable that GPMT stock recently saw a burst of bullish sentiment. With the U.S. government set to deliver unprecedented financial aid, it appears that everybody is taking the coronavirus seriously.
Nevertheless, Granite Point belongs among embattled stocks to sell. Sadly, our ecosystem is on the verge of an unparalleled crisis. Last week, a record 3.3 million Americans filed for unemployment benefits, according to the Washington Post. That implies an unemployment rate of 5.5%, destroying the so-called Trump recovery.
In this circumstance, you just can’t trust GPMT stock until the smoke clears. Even then, it’s a risk.
Hertz Global (HTZ)
Forget about stocks to sell. You can file Hertz Global (NYSE:HTZ) under the tagline, are you freaking kidding me? If you thought the oil sector is pointless in this environment – and it is – HTZ stock might as well be a rotary phone. Until major states lift their shelter-in-place orders, Hertz will have very little revenue coming its way.
Even without the lockdowns, I just don’t see how HTZ stock avoids further pain down the road. Given the infectious nature of Covid-19, most folks are voluntarily locking themselves down.
Moreover, what will society look like on the other side? Clearly, the $2 trillion stimulus is not enough if businesses continue to go bankrupt. Tragically, Hertz may be a company that hits every branch of the ugly tree until it’s on life support.
New Home (NWHM)
If there’s any organization that needs a bull market, it’s New Home (NYSE:NWHM). As a “new generation homebuilder,” New Home benefitted from President Trump’s pro-business economic policies. But in the pivotal fourth – and perhaps final – year, Covid-19 changed everything. With that, NWHM stock cratered just like you’d expect.
Sure, recent momentum has substantially boosted shares on a percentage basis. But this largely due to wild and panicked trading. Truth is, Wall Street is in denial. When the full hideousness of the econovirus becomes apparent, NWHM stock will have further to fall.
I’m going to be frank with you: for millions of Americans, particularly within communities of color, they were already in a crisis. Buying a new home is simply not on the agenda. Instead, it’s all about keeping the one you’re living in.
For those that think this economic crisis is just like any other emergency situation, consider Cinemark (NYSE:CNK). During the depths of the Great Recession, The New Yorker’s James Surowiecki opined that “movies really are recession-proof.” In fact, if you had bought CNK stock when Surowiecki originally wrote the piece and sold it early this year, you’d be looking at a very handsome profit.
Now, Cinemark is a candidate for stocks to sell just so that you can salvage any value from it. Historically, Hollywood benefitted during times of economic turmoil because movies provided escapism. However, with all movie theaters closed, that escapism has left the room.
Perhaps CNK stock may be an undervalued play at some point. Until then, stay away.
Fly Leasing (FLY)
When the economy is rocking and rolling, Fly Leasing (NYSE:FLY) presents an intriguing business. Plying its trade in the global aircraft leasing industry, the company offers 92 airplanes for clients to choose from. But in a sharp downturn, FLY stock is a liability.
Further, no one wants to fly with a pandemic threatening countries everywhere. Not only that, the U.S. Department of State issued a global level 4 health advisory. Essentially, the government wants you to stay put. For once, Washington and the American people are on the same page.
Plus, with airliners facing a severe threat to their existence, now’s not the time to gamble on FLY stock.
SeaWorld Entertainment (SEAS)
Following the damning documentary “Blackfish,” SeaWorld Entertainment (NYSE:SEAS) has been fighting to win back public trust. After a hugely negative impact to SEAS stock, the world-famous theme park was on an impressive recovery path. Without the Covid-19 pandemic, it’s very possible that SeaWorld could have secured new plateaus.
As it stands, SEAS stock is drifting aimlessly along with other stocks to sell. I’m not sure where SeaWorld goes from here. In 2019, 22.6 million people visited its parks in the U.S. Now, management can kiss that improving metric goodbye.
Even worse, its flagship parks in San Diego and Orlando are closed due to mandatory shutdown orders. Obviously, this has “avoid” written all over it.
A giant petri dish in the best of times, the allure and romance of cruise ships has always had a dark side. But the coronavirus may be the biggest black eye to the industry and individual operators like Carnival (NYSE:CCL). Some folks might view the horrific losses of CCL stock as a discounted opportunity. While the contrarian in me wants to agree, I’m hesitant.
For a start, Carnival owns the stricken Diamond Princess ship that started it all. What started as one person getting ill turned into an unprecedented quarantine and a real-time human experimentation. I’m not sure you can just recover from that black eye.
Moreover, the idea that government agencies can forcibly quarantine you – while on vacation no less – is a scary thought. For many, it has become a reality. Sadly, CCL stock belongs among the ranks of stocks to sell unless a miracle occurs.
Avis Budget Group (CAR)
Prior to the coronavirus, Avis Budget Group (NASDAQ:CAR) endured disruptive pressure from ride-sharing apps. Let’s face it – traveling anywhere, even in your home country, can be stressful. Driving in a new area, you have to worry about getting lost, for one thing. Additionally, some folks just don’t want to deal with hassles like traffic. Thus, CAR stock has been choppy over the past few years.
Today, I’m not sure what to make of Avis. True, there is an argument that once the economy returns to normal, CAR stock will rebound. And at these levels, it doesn’t need to rebound near multi-year highs to secure a handsome profit.
But what will normal look like? If unemployment hits 30% like some experts fear, Avis must downsize or risk implosion. For me, I see too many variables, which is why you should leave CAR with other stocks to sell.
US Concrete (USCR)
A “Trump stock” if there ever was one, US Concrete (NASDAQ:USCR) enjoyed significant upside during the President’s first year. However, the environment in Washington was contentious to say the least. Therefore, some of Trump’s pet projects, such as building a new U.S.-Mexico border wall, lacked credibility. Eventually, USCR stock would give up the Trump gains and then some.
To be fair, Trump has made good on some of his initiatives but there’s much work to be done. Regrettably, the coronavirus struck USCR stock at the wrong time. Instead of worrying about funding for new projects, every American is focused on stopping the bleeding.
When we come out of this mess, I’m just not sure if the construction industry will be an immediately viable one. For now, I’d stick US Concrete in your pile of stocks to sell.
MGM Resorts (MGM)
For casino stocks to sell, I’ve focused my attention on lesser-known organizations. However, don’t think that I’m just picking on the small guys. In this new normal, you should also be extremely skeptical about the majors like MGM Resorts (NYSE:MGM). Since the beginning of this year, MGM stock has bled red ink. And I’m not sure if the pain is over.
Las Vegas, which MGM calls home, depends on huge, carefree crowds willing to spend their troubles away. Otherwise, Las Vegas is a disgustingly hot wasteland with no point to its existence. Currently, we’re living in a society where people are unable to come, even if they wanted to (and nobody does).
This being the case, MGM stock is a sell until society normalizes. And who knows when that will be?
Air Lease (AL)
In a normal economy, Air Lease (NYSE:AL) makes plenty of sense. Given the high costs of airplanes, some airliners prefer leasing over outright ownership. Even during a broader downturn, this business model is appropriate. In fact, you can make the argument that this model is perfect for a slow economy. That’s not what’s plaguing AL stock.
This is no ordinary bear market. Rather, people are simply afraid to fly or to travel in close quarters with strangers. Given the airliners’ penchants for packing passengers in like sardines, this apprehension is quite understandable.
Fortunately, Air Lease is a relatively stable company so it can endure some slow periods. However, no company can last indefinitely without revenue. Thus, skepticism is still the name of the game, relegating AL to this list of stocks to sell.
Jack in the Box (JACK)
With the restaurant industry taking it in the chin, I’m not at all surprised that Jack in the Box (NASDAQ:JACK) is one of the worst-hit stocks to sell. To be fair, the company offers limited dining room service, along with drive-thru and delivery options. This brings some comfort to those who just need a bite to eat during this lockdown. However, these efforts have done jack for JACK stock.
In my opinion, one of the reasons for the fast-food specialist’s decline is its compensation structure. This is not a problem exclusive to Jack in the Box. Nevertheless, the rank and file in these stores make very little money.
So, in a time of crisis, workers will show up for their shifts, even if they shouldn’t. It poses an awkward question for JACK stock, especially since the underlying company doesn’t have the name recognition of McDonald’s (NYSE:MCD) and other competitors.
Six Flags Entertainment (SIX)
As a company and as a product, I love Six Flags Entertainment (NYSE:SIX). Some of their attractions are so wild that they can cause unintended discharges. However, with our new normal, social gatherings are frowned upon. Until that narrative shifts, SIX stock will remain incredibly embattled.
I don’t wish to exaggerate the pain awaiting Six Flags. Still, you’ve got to worry about permanent behavioral changes. I don’t know about you, but I’m fighting depression from this prolonged and indefinite period of house arrest. If that wasn’t already terrible, imagine people acclimatizing to this condition.
That could mean fewer people wanting to go out, which of course represents a net negative for SIX stock. Along with the economic uncertainties, this is another, though regrettable inclusion into the list of stocks to sell.
Camping World (CWH)
For most folks, Camping World (NYSE:CWH) is the go-to place for your recreational vehicle needs. But from another perspective, CWH stock might as well be an economic barometer. After all, what better way to gauge the strength of the economy than to measure consumers’ willingness to blow their money on crap like RVs?
Unsurprisingly, RV sales hit a bottom for this century in 2009. Since then, sales have progressively moved higher through 2017. In 2018, unit sales dipped 4.1% but kept alive the overall growth trend. Obviously, things will look a lot different when this year’s numbers are tallied.
If the economy suffers unprecedented damage, I’m afraid I can’t justify buying CWH stock. Even with what we know today, I’d rather stick shares into my list of stocks to sell.
Surgery Partners (SGRY)
In recent weeks, healthcare companies, especially those with some connection to addressing Covid-19, have witnessed astounding bullishness. However, Surgery Partners (NASDAQ:SGRY) is not one of those fortunate organizations. Instead, SGRY stock has plummeted, making it one of the nastiest investments among stocks to sell.
Unlike so many of the stocks to sell that round up this list, Surgery Partners has a credible recovery path.
Billed as a leading operator of surgical facilities and ancillary services, the medical firm provides a critical service. Unfortunately, hospital networks in heavily afflicted cities are overwhelmed. In the case of New York City, that involves the 911 emergency system. As it stands, you should wait on the sidelines for SGRY stock until the health crisis calms down.
Brookdale Senior Living (BKD)
As the name implies, Brookdale Senior Living (NYSE:BKD) specializes in senior care facilities and services. Under previous, normal circumstances, BKD stock enjoyed a strong fundamental catalyst. With the baby boomer generation retiring in droves, Brookdale seemingly had a wealth of revenue coming its way.
But just like the impact to the cruise liners, BKD stock has taken a beating due to an industry image problem. Before New York became the American epicenter for Covid-19, the state of Washington owned that dubious title. Particularly, elderly citizens in senior care facilities succumbed to the disease while family members watched helplessly.
Ordinarily, you’d think that Americans will just get over this crisis through time. On the other hand, this may be a Great Depression-like event which forever scars impacted people. We’ll just have to wait and see. For now, though, BKD should be left in the dust bin of stocks to sell.
Callaway Golf (ELY)
If you’re worried about your golf game, you live a very sheltered life. And that’s one of the reasons why Callaway Golf (NYSE:ELY) suddenly finds itself stuck with hurting stocks to sell. Golf is truly a rich person’s sport. In this environment, if you’re caught playing it, that could be a problem because it may single you out as a robbery target. So that’s one strike against ELY stock.
Another is that the entire sports world has shut down. With a lack of marketing opportunities, Callaway will start hurting. Plus, with the almost-inevitable economic downturn, golf is an easy expenditure to eliminate from one’s budget. Simply, ELY stock is an irrelevant investment now.
Lindblad Expeditions (LIND)
With zero incentive to go on a vacation, the entire travel industry has found itself on a widening portfolio of stocks to sell. But extravagant journeys that take you to far off places like Antarctica? Oh yeah, that’s a goner for sure. This is the reason why I’m giving the boot to Lindblad Expeditions (NASDAQ:LIND). Under these global market conditions, no room exists for LIND stock.
When the economy was working – at least for the upwardly mobile – Lindblad had speculative but compelling appeal. Who wouldn’t want to be counted among the few humans to step foot on Antarctica? But spending tens of thousands of dollars does not make sense in this crisis. Therefore, I’m forced to abandon ship on LIND stock.
A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare. As of this writing, he did not hold a position in any of the aforementioned securities.