Tech

Here are the 10 stocks with the worst performance in technology since the recent washout

People are queuing for t-shirts at a pop-up kiosk for online brokerage firm Robinhood on Wall Street after the company went public with an IPO earlier in the day, July 29, 2021 in New York City.

Spencer Platt News Getty Images | Getty Images

Macro conditions were already troubling for technology. With inflation at its 40-year high, and the Federal Reserve signaling a series of rising interest rates on the horizon, investors began the year fleeing growth stocks, sending the Nasdaq in January the worst month since March 2020, in the early days. pandemic.

Over the past three weeks, the forecast has gone from bad to much worse. Russia’s invasion of Ukraine last month shocked an already fragile stock market, spraying geopolitical unrest into stew volatility. Oil prices have just reached their highest level in 13 years, and prices for other commodities are rising due to supply problems as Russia is a key producer of wheat, palladium and aluminum.

Energy and utilities are the only places in the United States where investors find comfort. While everything else is under attack, technology stocks with the highest growth turn out to be nasty for everyone except the industry’s most avid bulls.

“The mood in the market right now is very bad for good reason,” Snowflake CEO Frank Slutman told CNBC’s “Mad Money” on Wednesday. Shares of the cloud data analytics provider fell despite revenues exceeding estimates, and the company gave an optimistic outlook.

The snowflake is more than 50% of its 52-week high reached in November. This makes the company a relatively safe haven compared to the vast branches of the technology industry. Many stocks have lost at least three-quarters of their value since the peak in late 2021, and some well-known names have fallen 90% or more.

Byron Dieter, a partner at Bessemer Venture Partners and a cloud evangelist, said the average member of his software subscription basket fell by 53%, and that the price-to-sales ratio fell from an average of 25 to below 12.

“This sector has just been processed, but macro trends remain very intact,” Dieter told CNBC’s TechCheck on Monday. “You still have these extremely high quality names, but they sell all over.”

CNBC has compiled a list of technology and related companies that are currently valued at $ 1 billion or more that have lost at least 75% of their value from their 52-week highs. Here are the 10 most famous companies.

Desire

The Wish discount mobile commerce app is experiencing problems shortly after its IPO in December 2020. The share price was $ 24 and reached $ 32.85. But now it is trading at $ 1.99 and more than 90% below the 52-week high intraday nearly a year ago.

Wish’s challenges are different from the broader challenges facing technology stocks. Revenue in the fourth quarter fell 64%, declining for the third consecutive period. With each quarter the story gets worse, and the main problem is that people are dropping the app.

CEO Vijay Talwar held part of a call on Tuesday about the company’s profits, trying to reassure investors.

“These numbers tell me that we need fresh thinking to get us back to the growth we know is possible,” Talwar said.

Shareholders do not see any improvement in the near future. Shares fell 16% last week.

Robin Hood

Robinhood’s stock trading app has become a favorite for retail investors who buy and sell shares of memes and cryptocurrencies, especially after Covid-19 hit hard.

Shares of Robinhood, which began trading in July, have largely fallen. It fell 70% from the IPO price and 87% from its August high.

An early cycle of excitement for Robinhood would be hard to endure in better times. On August 3, investors pushed shares up 24%, despite the lack of news. On August 4, it grew by 50% with the launch of options trading, which became a popular choice for Robinhood users. But a day later, shares fell nearly 28% after the company said existing shareholders would sell up to 97.9 million shares.

In January, the company gave a bleak forecast for the first quarter and showed a decline in monthly active users.

Fixing seams

In 2020, Stitch Fix more than doubled in value due to wider growth in e-commerce stocks. Since January 2021, stocks have declined. They are down 85% from last year, a maximum of 52 weeks, and more than 90% from a record a couple of months ago.

Shares of Stitch Fix fell 24% on Dec. 8 after the company warned that lower-than-expected growth in new customers would affect earnings in 2022. Much of the slowdown was due to the proliferation of a product called Freestyle, focused on personalizing your shopping experience. CFO Dan Jed called the transformation a “multi-year work”.

In addition to fewer new customers, Jedda said the management “reflects the current macro-impact of global supply chain challenges in the industry.”

Pelaton

Bike training maker Peloton has become a favorite of the 2020 pandemic. It’s been a long time.

In November, shares fell 35% in a single session after subscription revenue, digital subscribers and gross earnings did not live up to expectations. On January 20, CNBC reported that Peloton was temporarily suspending production of its connected fitness products, causing shares to fall nearly 24%.

Peloton said Feb. 8 that CEO John Foley would resign and the company would cut 20% of its workforce. Shares fell 83% from a 52-week high in July.

Confirm

Affirm was shocked during the pandemic, as his offer “buy now, pay later” was widely accepted online. Amazon even jumped on board in August, which helped boost stocks by 71% this month.

Since reaching a high market capitalization of about $ 47 billion in November, Affirm shares have fallen 81%, and the company is now valued at $ 9.5 billion.

In February, the stock fell 20% or more for several days in a row, even after its earnings and forecast exceeded estimates. DA Davidson analysts said the year-round instructions were disappointing because they meant weakness in the second half. However, they recommend buying stocks.

“With the expansion of consumers against the background of expanding the retail footprint of Affirm, the growth of Affirm is accelerating, while most analogues of BNPL are slowing down,” – analysts write.

OpenDoor is disrupting the real estate market with its new model. He buys houses and sells them on his platform.

The door is open

The door is open

Opendoor has become a pioneer in the domestic iBuying market, or instant buying, using a combination of technology and people to buy homes in large quantities and then sell them. When rival Zillow announced in early November that it was leaving the market, investors saw this as a positive sign for Opendoor, raising shares by 16% in one day.

However, four months after that, Opendoor fell more than 70% and shares fell 78% from their 52-week high almost a year ago.

Opendoor’s biggest drop came on Feb. 25, when shares lost 23%. Like many other unattractive technology companies, Opendoor exceeded estimates and exceeded its forecast, but investors still came out. One of the key indicators of the fourth quarter that disappointed was the contribution margin or income left over from home sales after expenses. This figure was 4% compared to 12.6% a year earlier.

Year

On February 18, Roku shares fell 22%, due to the biggest drop in one day since the release of the streaming campaign in 2017. Roku’s fourth-quarter earnings and first-quarter forecasts did not live up to expectations, prompting Pivotal Research Group to issue shares selling ratings.

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Sales of TV sets declined in the U.S. as device manufacturers faced shortages. Roku eats costs, not passes them on to customers.

“In fact, Roku plans to grow revenues at a slower pace than expected, coupled with significant cost growth, as a result of the potential slowdown in the global economy with increased competition,” wrote a note from Pivotal’s Jeffrey Vladarczak.

Shares fell 77% from a 52-week high in July.

Wix

Israeli website developer Wix is ​​still holding market share, but at a more modest pace, Atlantic Equities analyst Kunaal Malde wrote in a note to customers earlier this month. It downgraded its stock rating to neutral from the purchase equivalent.

Ten years ago, Wix increased revenue by 95% per year. But teenage growth fell for the first time in the fourth quarter.

Shares of Wix fell 23% on Feb. 16 after the company reported fourth-quarter results, the biggest decline since Nasdaq’s 2013 debut. Earnings and earnings for the first quarter did not live up to analysts’ expectations. Shares are 77% below their 52-week high since April.

“The effectiveness of sales and marketing is declining on the basis of gross profit,” wrote Malde. As costs are reduced, Wix also risks losing an additional share of commercial websites with higher profitability, ”he added.

Redwing

The online real estate brokerage company Redfin has shown rapid growth in 2021, when home buyers got rid of the problems with the pandemic. Revenue grew by 117%.

However, investors cut Redfin shares by 20% on February 18 after the company released its fourth-quarter figures. Shares are 76% below the 52-week high since March last year.

Redfin’s gross margin was lower than expected as a result of higher transaction bonuses and staff costs, said Chris Nielsen, the company’s chief financial officer, during a conference with analysts.

Revenue from the transaction also declined. The company has experienced a shift in its customer base: people are moving to cheaper homes, Nielsen said.

Toast

If you’ve been eating under a heat lamp at a nearby diner for the past couple of years, you’re probably familiar with the name Toast. The company has grown by providing restaurants with software and hardware for outlets, and has become a heavyweight industry during the pandemic, helping customers move into a world of contactless orders and payments.

Toast went public in September and is growing steadily until early November, reaching a high market capitalization of about $ 35 billion. Since then, it has fallen by about 75% to $ 8.8 billion.

The biggest one-day drop, a 18% drop, occurred on Feb. 16 after revenue exceeded estimates, but the company’s losses were greater than analysts had expected. Revenues are projected to grow 39% this year and 33% in 2023, and the company “continues to gain a strong share of U.S. restaurant space,” a note from Mizuho Securities analysts last month, which have equivalent content, said. stock rating.

WATCH: Full interview with Brion Dieter of Bessemer Venture Partners

Here are the 10 stocks with the worst performance in technology since the recent washout

Source link Here are the 10 stocks with the worst performance in technology since the recent washout

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