Share This Article

Facebook LinkedIn
Twitter Reddit
Print Email
Pinterest Gmail
Yahoo
Money Morning
×
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • AI Investing
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
  • Retire
    • Income Investing Guide
    • Retirement Articles
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    • Postcards
Login Archives Your Team About Us FAQ
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • AI Investing
    ×
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
    ×
  • Retire
    • Income Investing Guide
    • Retirement Articles
    ×
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    • Postcards
    ×
  • Subscribe
Enter stock ticker or keyword
×
Join 100,000+ Like-Minded Investors Today
Twitter
Tags: Short Selling
Stocks: GCI, M, NWSA, WTW

4 Top Stocks to Short Today

By Ashley Moore, Associate Editor, Money Morning • January 26, 2017

Start the conversation

Leave a Reply Click here to cancel reply.

You must be logged in to post a comment.

Top Stocks to ShortWhile the markets are hitting all-time highs, it can be easy to overlook the enormous profit potential of the top stocks to short.

Today, the Dow hit an all-time high of 20,125.58. But not every stock is climbing because it's a solid investment. Some are rising with the markets despite having dismal financials. Those are the types of stocks we're targeting today.

By shorting stocks, you're betting that the price of that stock will decline (for more information on how to short stocks, check out our complete beginner's guide).

Industries that have faced major disruption are great places to look for stocks to short. Some of the best examples of these industries include news and retail. The news industry has seen declining circulation numbers that are eating into company profits. The retail industry is facing lower store traffic, which is causing companies like The Limited to close all of their stores.

Here are the top stocks to short now...

Top Stocks to Short No. 4: News Corp.

News Corp. (Nasdaq: NWSA) operates in the disrupted news industry that we mentioned earlier. Weekly circulation for the industry as a whole was down 7% in 2015 (the most recent data), and Sunday circulation was down 4% in the same year.

"While the political world was turned upside down by the Trump ascendancy, the media world was exposed for its bias and intellectual vacuity. It has become obvious to an increasing number of Americans that the mainstream media has seen its best days," said Money Morning Global Credit Strategist Michael Lewitt.

Up Next: Turbocharge your investing returns with our top 5 money-making investment reports. Get them now - they're absolutely free. Click here...

While the industry as a whole is facing major challenges, News Corp. is barely hanging on. The owner of The Wall Street Journal has been facing declines in earnings per share with EPS last quarter of -$0.01.

The company is scheduled to announce 2016 Q4 earnings on Feb. 9 after the markets close. Forecasts put EPS at $0.18, which seems aggressive. Earnings per share for the past year have been:

  • December 2015: $0.20
  • March 2016: $0.05
  • June 2016: $$0.12
  • September 2016: -$0.01

NWSA stock has missed EPS expectations three of the last four quarters. September 2016 earnings numbers were particularly dismal. EBITDA (earnings before interest, tax, depreciation, amortization) was down 21% from the same quarter a year prior. On top of that, cash flows have taken a major hit. Cash flows for the quarter ending September 2016 were -$317 million, compared to $67 million for the same quarter the year prior.

Currently NWSA stock is trading at $12.12, up 5.85% year to date (YTD).

Top Stocks to Short No. 3: Gannett Co. Inc.

The next stock to short is another news outlet, Gannett Co. Inc. (NYSE: GCI), which owns USA Today.

Gannett is expected to announce earnings for the quarter ending December 2016 on Feb. 9 at 10:00 a.m. It is not likely that the announcement will boost its stock price since it is trading above its current book value per share of $9.14.

For the quarter ending September 2016, the company announced EPS of -$0.20 compared to $0.33 for the same quarter the year prior. It has failed to meet analysts' earnings expectations in three of the last four quarters by an average of 47%.

As Gannett's liabilities increased, its cash and equivalents decreased. At year-end 2015, the company had $1.37 billion in total liabilities and just $197 million in cash. By the end of September 2016, Gannett had $1.69 billion in liabilities and $117 million in cash.

GCI stock is currently trading at $9.50, down 1.24% YTD.

Top Stocks to Short No. 2: Macy's Inc.

Macy's Inc. (NYSE: M) is the latest victim of the changing retail sector. Department stores as a whole had $12.8 billion in sales in November and December, which is down from $13.68 billion for the same time period last year.

On Jan. 4, Macy's announced it will close 68 of 730 stores and lay off almost 10,000 employees. The decision came from holiday sales that were down 2.1% year over year at licensed stores and down 2.8% at stores owned by the company.

"The company was not expecting this news, another sign that management is failing to adjust quickly enough to the changing retail landscape," said Lewitt.

The latest earnings announcement marks seven quarters the company has seen declining sales.

Problems like declining traffic, low-cost competitors, and heavy discounting to generate sales are characteristic of the retail industry as a whole. With management not responding to the changing industry quickly enough, Lewitt has a price target of $20 in a year for Macy's.

M stock is currently trading at $30.00, down 15.67% YTD. If it hits Lewitt's price target, the stock will fall another 33%.

The best stock to short is a ticking time bomb with an end date of 2020...

Here Are 10 “One-Click” Ways to Earn 10% or Better on Your Money Every Quarter

Appreciation is great, but it’s possible to get even more out of the shares you own. A lot more: you can easily beat inflation and collect regular income to spare. There are no complicated trades to put on, no high-level options clearances necessary. In fact, you can do this with a couple of mouse clicks – passive income redefined. Click here for the report…

Claim My Free Report

Subscribe
Login
Notify of
guest

guest

0 Comments
Inline Feedbacks
View all comments


Latest News

September 14, 2023 • By Tom Gentile

Tulips Are the Secret to Trading the Next 300% Rally in AI

September 14, 2023 • By Chris Johnson

Tulips Are Telling Me How To Trade the Next 300% rally in AI

September 14, 2023 • By Garrett Baldwin

This Is My Biggest Economic Fear
Trending Stories
ABOUT MONEY MORNING

Money Morning gives you access to a team of market experts with more than 250 years of combined investing experience – for free. Our experts – who have appeared on FOXBusiness, CNBC, NPR, and BloombergTV – deliver daily investing tips and stock picks, provide analysis with actions to take, and answer your biggest market questions. Our goal is to help our millions of e-newsletter subscribers and Moneymorning.com visitors become smarter, more confident investors.

QUICK LINKS
About Us COVID-19 Announcements How Money Morning Works FAQs Contact Us Search Article Archive Forgot Username/Password Archives Profit Academy Research Your Team Videos Text Messaging Terms of Use
FREE NEWSLETTERS
Total Wealth Research Power Profit Trades Penny Hawk Midday Momentum
PREMIUM SERVICES
Money Map Press Home Money Map Report Fast Fortune Club Weekly Cash Clock Microcurrency Trader Hyperdrive Portfolio Rocket Wealth Initiative Quantum Data Profits Flashpoint Trader Darknet Alpha Accelerators Brutus Alerts Resource Traders Alliance L.A.U.N.C.H. Investor Rob Roy Trader Long-Term Equity Profits

© 2023 Money Morning All Rights Reserved. Protected by copyright of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including the world wide web), of content from this webpage, in whole or in part, is strictly prohibited without the express written permission of Money Morning.

Address: 1125 N Charles St. | Baltimore, MD, 21201 | USA | Phone: 888.384.8339 | Disclaimer | Sitemap | Privacy Policy | Whitelist Us | Do Not Sell or Share My Personal Information

wpDiscuz