Markets were mixed this morning as the Dow was treading water, while the S&P 500 and Nasdaq are in the green, as they look for direction at the end of the Month and Quarter. This morning there was some decent consumer sentiment readings, with the Conference Board’s consumer confidence index rising to 98.1 for the month, beating expectations of 91, and up significantly from May’s 85.9 reading. The re-opening of the economy is clearly making consumers more comfortable here, as well as unemployment decreasing. Of course, faced with increasing uncertainty around the increase in COVID-19 infections, and an uneven recovery, are the consumers getting ahead of themselves here? It was reported this morning that nearly half of the US population is without a job, as the employment-population ratio plunged to 52.8% in May, according to the Bureau of Labor Statistics. With that, our deep learning algorithms have paired with our Artificial Intelligence (“AI”) technology to offer you several Top Shorts today to either hedge your portfolio downside or bet against the market.
Biocryst Pharmaceuticals Inc (BCRX)
First on the list today is Biocryst Pharmaceuticals Inc, a biotechnology company involved in the research and development of novel small-molecule drugs, aimed to block key enzymes involved in infectious and inflammatory diseases. However, the stock has surged recently, and our AI algorithms think that this is a great entry point to short the stock, with the stock up 46.47% for the year alone. The factor scores given are C in Growth, C in Momentum Volatility, and F in Quality Value. As for the financials, Revenue grew by 89.67% over the last three fiscal years to $48.84M in the last fiscal from $25.19M three years ago. EPS grew by 3.19% but was negative $(0.94) in the last fiscal year, compared to $(0.78) three years ago. Operating Income was negative $(99.46)M in the last fiscal year compared to $(57.41)M three years ago. ROE was (248.9%) in the last year, worse than the (154.2%) from three years ago.
Fluent Inc (FLNT)
Next on the Top Short list is Fluent Inc, a data-driven digital marketing services company that has not been doing well long-term. The stock has already lost 25.81% for the year but the downward pressure is immense for the stock. Our AI systems have identified factor scores of D in Technical, C in Growth, D in Momentum Volatility, and D in Quality Value. Revenue grew by 4.4% in the last fiscal year to $281.7M, growing by 38.92% over the last three fiscal years from $211.7M. Operating Income was $8.1M, showing growth of 164.71% over the last three fiscal years when it posted a negative $(11.9)M. EPS grew by 96.55% over the last three fiscal years as well but was poor overall, at a negative $(0.02) in the last fiscal year, compared to $(0.87) three years ago. ROE was (0.8%) in the last year better than the (14%) three years ago. Forward 12M Revenue is expected to grow by only 1.75%.
Grubhub Inc (GRUB)
Our AI systems are not hungry for this stock, as Grubhub Inc makes the Top Short list again today with factor scores of D in Technical, F in Growth, C in Momentum Volatility, and D in Quality Value. The company is an online takeout food platform for diners and restaurants, but it looks pricey at these levels after gaining 47.59% year-to-date with the RSI almost showing overbought at a shade under the 70 level. Revenue grew by 2.99% in the last fiscal year to $1312.2M, growing by 97.83% over the last three fiscal years from $683.1M. Operating Income was $(0.6)M in the last fiscal year compared to $99.4M three years ago. EPS was a loss of $(0.2) in the last fiscal year compared to a gain of $1.12 three years ago. ROE was (1.3)% in the last year, much worse than the 9.5% three years ago. Forward 12M Revenue is expected to grow by 3.52%.
Liquidia Technologies (LQDA)
Liquidia Technologies makes the Top Short list today with factor scores of D in Technical, D in Momentum Volatility, D in Quality Value from our deep learning algorithms. The company is a late-stage clinical biopharmaceutical company, and after gaining 142.5% for the year, our AI thinks that the next leg is more likely to be lower. Revenue grew by 11.22% over the last three fiscal years to $8.07M from $7.26M three years ago. EPS grew by 14.22% in the last fiscal year but was negative $(2.57), a growth of 95.66% over the last three fiscal years from an extremely negative $(51.78). Operating Income was $(46.82)M in the last fiscal year compared to $(26.03)M three years ago. ROE was an abysmal (177.4%) in the last year. Look for the recent drop in price to continue.
Mannkind Corp (MNKD)
Our final Top Short today as identified by our AI systems is Mannkind Corp, a small-cap biopharmaceutical company focused on the development and commercialization of inhaled therapeutic products. A recent spike in the share price has come at a cost to new investors, as it was followed by a precipitous drop, one that our deep learning algorithms expect to continue. Factor scores have been identified as F in Technical, C in Momentum Volatility, and D in Quality Value. As for the financials, Revenue grew by 456.76% over the last three fiscal years supporting the recent surge, earning $63M on the top line in the last fiscal, from $11.1M three years ago. Operating Income grew by 17.2% in the last fiscal year but was still negative $(46.5)M, growing by 59.56% over the last three fiscal years from negative $(95.2)M. EPS grew by 14.82% in the last fiscal year but similar to operating income was negative at $(0.27), a growth of 79.65% over the last three fiscal years. Of course, EPS was $(1.13) three years ago. Forward 12M Revenue is expected to grow by 16.59%.