UK approves increased submarine-related exports to Taiwan, risking angering China

Reuters exclusively reported that Britain approved a sharp increase in exports of submarine parts and technology last year to Taiwan as it upgrades its naval forces, a move that could impact British ties with China. The value of licences granted by the British government to companies for the export of submarine-related components and technology to Taiwan totalled a record 167 million pounds ($201.29 million) during the first nine months of last year, according to UK government export licensing data. That is more than the previous six years combined, a Reuters analysis of the data showed.

Market Impact

The increase in licenses granted reflects greater demand from Taiwan along with Britain’s increased willingness to support Taiwan. 

Article Tags

Type: Reuters Best

Sectors: Aerospace & Defence

Regions: AsiaEurope

Countries: ChinaUK

Win Types: Exclusivity

Story Types: Exclusive / Scoop

Media Types: Text

Customer Impact: Major Global Story

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Some investors offering Ethiopia maturity extension on 2024 bond

Reuters exclusively revealed that an informal group of international bondholders has proposed to Ethiopia’s government to extend the maturity of the country’s $1 billion eurobond issue coming due in 2024. The sources said the proposal to extend the eurobond maturity foresees a coupon of 6.625% – the same as the current one on what was originally a 10-year bond, which is the country’s only outstanding international note. The next coupon payment on the 2024 bond is due in June, with the issue trading at around 68 cents to the dollar and yielding more than 30%, according to Refinitiv data. It has a long-term rating of CCC- from Fitch Ratings, which means it is a substantial credit risk with a real possibility of default. 

Market Impact

The nation of 115 million has been one of the world’s fastest-growing economies in the past 15 years, boosted by heavy infrastructure investment, but the COVID-19 pandemic and the conflict that has now subsided have slowed expansion in recent years. The IMF estimates that Ethiopia’s economy will grow by 5.3% this year.

Article Tags

Type: Reuters Best

Sectors: Economy & Policy

Regions: Africa

Countries: Ethiopia

Win Types: Exclusivity

Story Types: Exclusive / Scoop

Media Types: Text

Customer Impact: Significant National Story

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India plans new security testing for smartphones, crackdown on pre-installed apps

Technology

Sources exclusively revealed to Reuters that India plans to force smartphone makers to allow removal of pre-installed apps and mandate screening of major operating system updates under proposed new security rules. The plan for new rules, details of which have not been previously reported, could extend launch timelines in the world’s No.2 smartphone market and lead to losses in business from pre-installed apps for players including Samsung (005930.KS), Xiaomi (1810.HK), Vivo, and Apple (AAPL.O).

Market Impact

The new regulations could extend launch timelines in the world’s No.2 smartphone market and lead to losses in business from pre-installed apps for players including Samsung (005930.KS), Xiaomi (1810.HK), Vivo, and Apple (AAPL.O).

Article Tags

Topics of Interest: Technology

Type: Reuters Best

Sectors: TechnologyTelecommunications

Regions: Asia

Countries: India

Win Types: Exclusivity

Story Types: Exclusive / Scoop

Media Types: Text

Customer Impact: Significant National Story

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Netflix making preparations to open Vietnam office

Business & FinanceEconomy

Reuters exclusively reported that U.S streaming giant Netflix Inc (NFLX.O) is preparing to open an office in Vietnam after years of negotiations with authorities and completing a risk assessment. A local office would make Netflix the first major U.S tech firm with a direct presence in the fast-growing Southeast Asian country of 100 million, increasingly seen as too lucrative to ignore despite wariness over its stringent internet rules. 

Market Impact

With the fastest growing middle class in Southeast Asia, Vietnam has become a key market for tech giants.

Article Tags

Topics of Interest: Business & FinanceEconomy

Type: Reuters Best

Sectors: Economy & PolicyTechnology

Regions: AmericasAsia

Countries: United StatesVietnam

Win Types: Exclusivity

Story Types: Exclusive / Scoop

Media Types: Text

Customer Impact: Significant National Story

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ECB likely to stick to big rate hike despite banking turmoil

Business & Finance

In the wake of an exclusive Reuters report, financial markets adjusted expectations around future euro rate rises. Reuters reported that the European Central Bank was still leaning towards a 50-basis point hike, despite volatility after the Silicon Valley Bank collapse. The Reuters report, which prompted German bond futures to fall, revealed that policymakers were confident that turmoil around SBV was dissipating, and that the regional economy was strong enough to withstand further policy tightening aimed at tackling inflation. Investors had started to doubt that commitment as the SVB drama unfolded. Data released hours after the report underlined that analysis, showing a stronger than expected rise in industrial production while Germany, the bloc’s largest economy, was also seen picking up. In the ECB’s Thursday meeting it was confirmed that they, indeed, hiked by 50 basis points.

Market Impact

The ECB activated a 50-basis point hike. German bond futures fell after the report was released and revealed the regional economy was strong enough to withstand further policy tightening aimed at tackling inflation. Data revealed a stronger than expected rise in industrial production while Germany was also seen picking up.

Article Tags

Topics of Interest: Business & Finance

Type: Reuters Best

Sectors: Business & Finance

Regions: EuropeGlobal

Countries: Germany

Win Types: Exclusivity

Story Types: Exclusive / Scoop

Media Types: Text

Customer Impact: Important Regional StorySignificant National Story

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Inclusive Capital’s Jeff Ubben named to Vistry board. What could happen next

A contractor operates a roller on the construction site of the HS2 Ltd. Old Oak Common super-hub railway station, in view of the Vistry Partnerships regeneration project Oaklands House, in London, U.K., on Wednesday, June 23, 2021.

Luke McGregor | Bloomberg | Getty Images

Company: Vistry Group (VTY.L)

Business: Vistry Group operates as a housebuilder in the United Kingdom and operates in both the open market and the affordable housing sector. They seek to develop sustainable new homes and communities across all sectors of the U.K. housing market. On Nov. 11, 2022, Vistry acquired Countryside Partnerships for £1.25 billion ($1.4 billion). Vistry operates through a partnership model, which is unique to the U.K., where they seek to reuse land wherever possible, focusing on mixed-tenure developments that deliver positive social impact. The partnerships business operates across 19 business units and works closely with governmental bodies, housing associations and local authorities, as well as selling homes directly to customers on the open market.

Stock market value: $3.09 billion

Activist: Inclusive Capital Partners

Percentage ownership: 5.9%

Average cost: n/a

Activist commentary: Inclusive Capital Partners is a San Francisco-based investment firm focused on increasing shareholder value and promoting sound environmental, social and governance practices. It was formed in 2020 by ValueAct founder Jeff Ubben to leverage capitalism and governance in pursuit of a healthy planet and the health of its inhabitants.

As a pioneering activist ESG investor (AESG), Inclusive seeks long-term shareholder value through active partnership with companies whose core businesses contribute solutions to this pursuit. Their primary focus is on environmental and social value creation, which leads to shareholder value creation.

What’s happening?

On Wednesday, Vistry announced the appointment of Inclusive’s Ubben as a nonexecutive director to the board and the upcoming resignations of two incumbent directors, Katherine Innes Ker and Nigel Keen.

Behind the scenes

Vistry landed on Inclusive’s radar as a result of their engagement with another company – Countryside Partnerships. In May 2022, Inclusive had a 9.2% stake in Countryside and had made two bids to acquire the company, going as high as £1.5 billion. Both bids were rejected.

But Inclusive’s interest sparked significant shareholder pressure to sell Countryside and the following month, the company announced that it was seeking a buyer. On Sept. 5, 2022, Vistry agreed to acquire Countryside in a cash and stock deal, which closed on Nov. 11, 2022.

In the four months since the Countryside acquisition, the market has reacted favorably to the combination. Inclusive led the charge on the merger and now they are taking an active role at the combined company.

Vistry operates through a partnership model whereby the land is provided to them by governmental land authorities at no cost and they commit to build a certain amount of affordable housing. They build communities that are mixed tenure, placing affordable housing among open market homes, retail stores, etc. This model has the benefits of a secular shift to affordable housing and is capex light since they do not have to acquire the land. The company trades cheaply at 7 to 8 times earnings and has high growth prospects, complimented by their community benefits.

Inclusive said Vistry’s business model gives it the scale, operating synergies and resources to deliver societal benefits and great long-term returns.

On Wednesday, Ubben was named a director and two board members, Innes Ker and Keen, resigned. Inclusive is an amicable investor that is often invited onto boards. This situation is no exception. However, the exit of two incumbents alongside Ubben’s appointment indicates that there was a call by shareholders for a bigger board refreshment than just adding one shareholder representative. While this type of action is somewhat unusual for a European company, it is worth noting that the company’s five largest shareholders representing 40% of the stock are all North American investors who are more likely to engage with management than European investors.

This leaves a board that is undergoing a refreshment process and a CEO who is universally well liked and on the same page as shareholders opening the door for a methodology that has worked very well for Ubben going back 20+ years to ValueAct – let a good management team continue to generate cash flow and sit on the board and help advise the best way to use that cash flow.

One tactic he has used successfully in the past to grow shareholder value is to do a share repurchase at the bottom and keep cash when the company is fairly valued.

Finally, as with all Inclusive investments, this one has an impact element as well as a value element. The AESG thesis here is obvious as the core purpose of this company is to further social equality – developing affordable, sustainable housing. What is interesting about this from an ESG perspective is that it is a social ESG thesis, which is generally the most difficult type of ESG thesis to monetize. But, in this case the community benefits align so perfectly with the company growth prospects – topline company growth means more affordable housing.

Ken Squire is the founder and president of 13D Monitor, an institutional research service on shareholder activism, and the founder and portfolio manager of the 13D Activist Fund, a mutual fund that invests in a portfolio of activist 13D investments.

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Stocks making the biggest moves premarket: DB, COIN, SQ, MRO

A Deutsche Bank AG flag flies outside the company’s office on Wall Street in New York.

Mark Kauzlarich | Bloomberg | Getty Images

Check out the companies making headlines in premarket trading.

Deutsche Bank — The German lender’s shares tumbled 13% following a spike in credit default swaps — a form of insurance for a company’s bondholders against its default — raising concerns again over the health of the European banking industry.

Banks — Shares of U.S. banks fell as investors worried about the global banking system. First Republic Bank fell 3%, while Western Alliance, Zions Bancorporation and Fifth Third all lost more than 2%. Large banks weren’t immune from traders’ skittishness. JPMorgan Chase and Bank of America were down 2% as well.

Block — The payment company slid 1.9%, a day after losing nearly 15% when short seller Hindenburg Research alleged that Block facilitates fraud. On Friday, Block was downgraded to hold by Atlantic Equities on the lack of clarity on its Cash App after Hindenburg’s short position.

Coinbase — Investors put more pressure onto shares of the cryptocurrency exchange early Friday. The stock ticked down 2.3% in premarket trading, a day after the company disclosed it received a Wells notice from the Securities and Exchange Commission. The disclosure pushed the stock down more than 14% on Thursday. Year to date, the stock is still up 87% this year.

Energy stocks — Energy names fell in in the premarket as oil prices slid, with investors worried about potential oversupply. Marathon Oil and Devon Energy fell about 3%. Halliburton, Occidental Petroleum, Diamondback Energy and Exxon Mobil each lost about 2%.

Incyte — The pharmaceutical company saw its shares fall more than 3% after it issued a regulatory update on its ruxolitinib extended-release tablets. The FDA has said it can’t approve the company’s application in its present form.

Scholastic — Shares of the children’s book publisher fell 13% after the company reported a decline in revenue for its fiscal third quarter from the previous year and lowered its financial guidance for the full year. Scholastic now projects about 4% revenue growth for the year, compared to its previous outlook of between 8% and 10%.

 — CNBC’s Michelle Fox and Brian Evans contributed reporting.

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Reuters reveals scores of Google rivals want EU tech law used in antitrust case

Technology

Reuters exclusively revealed more than 40 European rivals to Google’s shopping service urged European Union (EU) antitrust regulators to use newly adopted tech rules to ensure the Alphabet unit complies with a 2017 EU order to allow more competition on its search page. The European Commission fined Google 2.4 billion euros five years ago and told the firm to stop favouring its shopping service.

Article Tags

Topics of Interest: Technology

Type: Reuters Best

Sectors: Equities

Regions: Europe

Win Types: Exclusivity

Story Types: Exclusive / Scoop

Media Types: Text

Customer Impact: Important Regional Story

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7 Crypto Miners That Are Minting Money

Bitcoin (BTC-USD) has gone on an impressive run over the past two weeks, rallying 38%. In fact, the cryptocurrency looks like it may be on its way back to $30,000. Not only is that great news for BTC investors, but it’s also a solid catalyst for crypto miners. That’s because mining revenue depends on the direction of bitcoin. Where bitcoin goes, crypto mining stocks typically follow.

Even better, there are predictions bitcoin could see $100,000 this year.  That’s what Marshall Beard, chief strategy officer at cryptocurrency exchange Gemini, told CNBC. As the article notes:

Part of the industry’s positive view on bitcoin right now actually stems from how the asset has performed during the banking turmoil sparked by the collapse of Silicon Valley Bank and the failure of two crypto-friendly lenders Silvergate Capital and Signature Bank.

Instead of crashing, bitcoin rallied.

Bitcoin proponents say this is evidence that bitcoin is offering an alternative to the traditional banking system as a place for people to keep their money safe.

If bitcoin can push higher, so will these top crypto miners and related exchange-traded funds (ETFs).

BITO ProShares Bitcoin Strategy ETF $17.16
BITS Global X Blockchain & Bitcoin Strategy ETF $31.11
MARA Marathon Digital $7.81
RIOT Riot Platforms $8.63
BTBT Bit Digital $1.40
HIVE HIVE Blockchain $3.12
HUT Hut 8 Mining $1.74

ProShares Bitcoin Strategy ETF (BITO)

On March 15, I highlighted an opportunity in the Pro Shares Bitcoin Strategy ETF (NYSEARCA:BITO) as it traded around $15 a share.  It closed Friday at $17.16, up 14% in just seven trading days and close to my initial price target of $17.50. From here, I’d like to see BITO refill its gap around $22.50, which is roughly 31% above the current price.

The ETF tracks the performance of spot bitcoin and was the first bitcoin-linked ETF launched in the U.S. It is also the world’s largest and most actively traded cryptocurrency ETF, according to ProShares.

By mimicking the price of bitcoin as closely as possible without investing in the cryptocurrency itself, BITO offers exposure to bitcoin combined with the ease of investing in an ETF. As noted by Money.com, “Like all crypto ETFs, part of the allure of BITO is that investors don’t need to deal with cryptocurrency wallets and private keys but can instead invest through a broker they already use.”

 BITO has an expense ratio of 0.95%.

Global X Blockchain & Bitcoin Strategy ETF (BITS)

Global X Blockchain & Bitcoin Strategy ETF (NASDAQ:BITS) is another crypto ETF I highlighted recently. Since my March 15 article, BITS is up nearly 11% and could see its shares continue to run.

According to Global X, BITS “takes long positions in U.S. listed bitcoin futures contracts and invests, directly and/or indirectly, in companies positioned to benefit from the increased adoption of blockchain technology. BITS will not invest directly in bitcoin, and it currently delivers exposure to blockchain companies through other ETFs, including the affiliated Global X Blockchain ETF (NASDAQ:BKCH).”

BKCH counts a number of the crypto miners on today’s list among its top holdings.

BITS has an expense ratio of 0.65%.

Marathon Digital (MARA)

Moving on from ETFs to individual crypto miners, Marathon Digital (NASDAQ:MARA) “is building one of the largest bitcoin mining operations in North America,” according to the company.

The crypto miner’s shares have tracked the price of bitcoin higher, jumping 46.5% over the past two weeks to trade at $7.81. If the stock can break above resistance around $9.57, we could see it run back to $12. That would be a gain of more than 50% from current levels.

The company’s most recent earnings were nothing to write home about. However, last month, Marathon Digital managed to increase its average bitcoin produced per day by 10% over January.  It produced 683 bitcoin in February and “successfully energized nearly 19,000 Bitcoin miners across multiple facilities.”

Finally, it increased its hash rate 30% month over month to 9.5 exahashes per second (EH/s).

Riot Platforms (RIOT)

Riot Platforms (NASDAQ:RIOT) is another one of the leading crypto miners that has run up sharply since mid-March, with shares rallying 63% to $8.63. If the stock can break above $10.52, it could see $15 shortly thereafter, which is nearly 74% above the current price.

According to the company’s February production and operations update, it produced 675 BTX, up 55% year over year. As of Feb. 28, Riot held 7,058 BTC. And that was after selling 600 BTC last month and netting approximately $14.2 million for them. Additionally, Riot’s fleet of more than 87,000 miners had a hash rate capacity of 9.8 EH/s.

“February was another month of operational excellence for Riot, during which we produced 675 Bitcoin in the shortest month of the year, and despite one of the largest increases in mining difficulty in recent history,” said Riot Chief Executive Officer (CEO) Jason Les. “We have also continued to make progress on repairs to our immersion buildings, including Building G, where we now anticipate a return to full operations by the second half of 2023. Once achieved, this will bring back 1.9 EH/s of hash rate currently offline and not included in our reported hash rate capacity.”

This additional capacity could prove to be another positive catalyst for RIOT.

Bit Digital (BTBT)

Shares of bitcoin miner Bit Digital (NASDAQ:BTBT) are up 40% over the past two weeks to trade at $1.40.

In February, Bit Digital produced 108.2 bitcoins. While this was down 19% from January, the company noted that the decrease was due in part to the fact that there are fewer days in the month. It had 13,645 active bitcoin miners at the end of February with a rash rate of 1.30 EH/s.

Bit Digital noted that the fair market value of its 696.5 BTC holdings stood at approximately $16.1 million on Feb. 28, while its 7,332.6 Ethereum (ETH-USD) tokens had a fair market value of around $11.8 million. And keep in mind that this was prior to the latest run-up in the crypto sector. 

Back in October, InvestorPlace contributor Josh Enomoto pegged BTBT as a good buy for young investors, noting that it enjoyed a stable balance sheet and no debt, which should help the company withstand volatility in the crypto sector.

HIVE Blockchain (HIVE)

HIVE Blockchain (NASDAQ:HIVE) is another one of the top crypto miners to consider. After finding support at around $2.25, shares have jumped more than 30% in the past two weeks to $3.12, where they are consolidating. From here, I’d like to see the stock challenge overhead resistance around $4.25 initially. That is 36% above the current price.

HIVE produced 250 bitcoin in February with an average hash rate of 2.75 EH/s.  The company also noted it hit its 3 EH/s target by mining at a full capacity of 3,080 PH/s. And it closed the month with 2.81 EH/s of mining capacity.

“Our team has focused on profitability, with 25% gross mining margins in our recent fiscal quarter for the 3 months ending December 31, 2022,” said Executive Chairman Frank Holmes. “We seek to optimize our profit from gross mining margins, on a monthly basis, by optimizing the efficiency of our operating fleet, and strategically curtailing or grid balancing.”

Hut 8 Mining (HUT)

Last up on our list of crypto miners to consider is Hut 8 Mining (NASDAQ:HUT). As with the other names on today’s list, it has rebounded sharply over the past two weeks, rising 38%.

While earnings haven’t been so hot in recent quarters, I expect them to improve along with the price of bitcoin.

The company’s revenue decreased by 13.3% to $150.7 million in 2022. Yet, the amount of bitcoin it mined increased 28.1% to 3,568 “due to an increase in hashrate from the expansion of the Company’s fleet of miners and mining activities.”

Investors can expect HUT to continue trading higher with the price of bitcoin if this rally holds.

On the date of publication, Ian Cooper did not have (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.

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7 Stocks to Sell in March Before They Crash and Burn

While there’s something romantic about taking a shot on an underappreciated enterprise, a countervailing narrative also exists, which brings us to the topic of stocks to sell. To be sure, very few people enjoy discussing this subject (especially if you own the shares mentioned). However, it’s unavoidable. At some point, you’re going to have to issue some rejections.

That’s why I’m not always onboard with pro athletes showboating about how no one believed in them, which then provided the fuel to succeed. Believe me, for every Tom Brady, there are probably thousands of Tim Tebows. No disrespect meant toward the upstanding Mr. Tebow but coaches and managers must make tough decisions to win. So it is with stocks to sell. For the enterprises below, poor financial metrics and/or rough fundamentals combined with pessimistic analyst views make a recovery in the near term unlikely. With that, below are the stocks to sell.

XPEV Xpeng $9.62
BBBY Bed Bath & Beyond $0.82
SPCE Virgin Galactic $4.10
RDFN Redfin $8.00
AI C3.ai $25.27
VAPO Vapotherm $0.61
BYND Beyond Meat $16.27

Xpeng (XPEV)

Fundamentally, Chinese electric vehicle manufacturer Xpeng (NYSE:XPEV) doesn’t seem like one of the stocks to sell. After all, industry advocates love to rave about how EVs represent the future of transportation and mobility. However, the problem with Xpeng is that it’s stuck in an extremely competitive field.

Notably, JPMorgan Chase might be giving up on Xpeng, reducing its long position in XPEV. Further, the pensive action aligns with broader analyst skepticism toward the EV maker. On a wider scale, experts note that demand in the Chinese EV market also weakened, hurting Xpeng’s forward potential. As well, the company doesn’t really enjoy outstanding financials. Most glaringly, its trailing-year operating and net margins sit more than 30% below parity.

Finally, Wall Street analysts peg XPEV as a consensus hold. Their average price target is $10.07, which only represents less than 2% upside potential.

Bed Bath & Beyond (BBBY)

Once generating tremendous attention as a meme stock, Bed Bath & Beyond (NASDAQ:BBBY) still maintains a cult following. However, this following no longer aligns with positive sentiment toward BBBY stock. Since the start of the year, BBBY hemorrhaged an alarming 66% of equity value. For the trailing year, shares fell more than 96%. That’s probably the signal that the embattled retailer symbolizes one of the stocks to sell.

Another factor to consider is that because BBBY stock fell below $1, it broke a funding agreement with an asset management firm. Therefore, the underlying retailer’s ability to raise capital remains a serious concern. Regarding its financial profile, there’s not much to be said that hasn’t been noticed by other analysts. Operationally, the company appears doomed, with negative revenue growth and profit margins. As well, it has very little cash relative to debt.

Not surprisingly, analysts peg BBBY as a strong sell. I’d just ignore its $1.03 price target (which implies 31% growth). The experts probably failed to update their spreadsheets.

Virgin Galactic (SPCE)

On the surface, Virgin Galactic (NYSE:SPCE) doesn’t seem to be one of the stocks to sell. Prominently, SPCE gained over 15% of equity value since the Jan. opener. More importantly, the spaceflight company represents a direct participant of the burgeoning space economy. Over the next few decades, the space economy could command a trillion-dollar valuation or more.

Overall, though, that’s little comfort to longtime stakeholders of SPCE. For example, in the past 365 days, shares fell nearly 59%. Since its public market debut (via a merger with a special purpose acquisition company or SPAC), Virgin Galactic fell 60%. Financially, the enterprise suffers from negative revenue growth and profitability margins that dropped into the abyss. It’s also extremely overvalued relative to sales, adding insult to injury.

Turning to Wall Street, analysts peg SPCE as a consensus moderate sell. Further, their average price target sits at $3.93, implying 2.5% downside potential.

Redfin (RDFN)

Without context, Redfin (NASDAQ:RDFN) appears anything other than one of the stocks to sell. Since the Jan. opener, RDFN almost doubled in market value. Further, with the Federal Reserve committed to tackling stubbornly elevated inflation – despite ongoing banking sector concerns – the real estate broker seems poised for better days ahead.

Unfortunately, in the trailing one-year period, RDFN gave up more than 57%. Further, the Fed’s raising of the benchmark interest rate will hurt affordability on the backend. In other words, while the price may go down, the threshold for qualifying for a mortgage will rise. Another factor to consider is the company’s generally terrible financials. Most conspicuously, the company’s operating and net margins fell on average 14% below parity. Also, its Altman Z-Score of 0.87 reflects a distressed enterprise.

Looking to the Street, analysts peg RDFN as a consensus hold. Moreover, their average price target sits at $7.51, implying over 9% downside risk.

C3.ai (AI)

With the rise of artificial intelligence and machine learning, it’s understandable that the market gravitated toward entities like C3.ai (NYSE:AI). Billed as a comprehensive enterprise AI application development platform, C3.ai offers myriad turnkey solutions for companies seeking to leverage the power of advanced digitalization. Sure enough, since the Jan. opener, AI stock gained nearly 125%.

One of the stocks to sell? I think not, might be the resounding answer. However, since making its public market debut in late 2020, AI gave up more than 79% of equity value. Therefore, from a longer-term framework, C3.ai suffers from a credibility crisis. In all fairness, C3.ai benefits from a tremendously cash-rich balance sheet. So, one could make the argument that it’s not going bankrupt anytime soon. However, it’s also not going to be consistently profitable anytime soon if it doesn’t address its expanding operating losses.

Perhaps the most worrying aspect is that it doesn’t generate much positive sentiment among analysts, who rate it a hold. Additionally, their average price target comes out to $20.57, implying downside risk of more than 17%.

Vapotherm (VAPO)

A medical device manufacturer, Vapotherm (NYSE:VAPO) created the first heated and humidified high-flow therapy nasal cannula system. Though the company seemingly carries medical relevance, it’s been a rough year for VAPO stock. And it only seems to be getting worse, making it one of the stocks to sell. So, for instance, shares stumbled over 78% since the Jan. opener.

Thought that was bad? It gets even worse. Over the trailing year, VAPO hemorrhaged nearly 96%. Trading hands at 60 cents a pop, Vapotherm needs a miracle to stay in the game. Financially, however, the prospects appear dim. If VAPO represented a human patient, the doctors might say there’s nothing they can do. With an Altman Z-Score of 9.3 below breakeven, Vapotherm is significantly distressed. Operationally, the company’s three-year revenue growth rate sits at 1.1% below zero. Naturally, its operating and net margins sit deeply below zero.

Not shockingly, analysts peg VAPO as a consensus moderate sell. Their price target averaged down to 50 cents, implying 18% downside risk.

Beyond Meat (BYND)

As a concept, I’ve gone to truly appreciate what companies like Beyond Meat (NASDAQ:BYND) are doing regarding plant-based meat. Typically, when the option to go meatless comes up, I sometimes partake (probably about one-third of the time). However, my personal feelings can’t get in the way of the facts. And the fact is, BYND has struggled.

Sure, you can point to its year-to-date performance of almost 24% up. However, against the trailing year, BYND fell an alarming 70%. Financially, circumstances don’t look appealing for Beyond Meat. Most notably, its Altman Z-Score of 0.59 below zero indicates a highly distressed enterprise. Also, its revenue growth fell 2.2% below breakeven. As for profitability, forget about it. Whether you’re talking gross, operating or net margins, each one of these metrics pings below zero. I’m sorry but from practically every objective fiscal measure, BYND represents one of the stocks to sell.

Lastly, analysts peg BYND as a moderate sell. Their average price target sits at $11.50, implying nearly 25% downside risk.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

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.

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