The right stocks can make you rich and change your life.
The wrong stocks, though… They can do a whole lot more than just “underperform.” If only! They can eviscerate your wealth, bleeding out your hard-won profits.
They’re pure portfolio poison.
Surprisingly, not many investors want to talk about this. You certainly don’t hear about the danger in the mainstream media – until it’s too late.
That’s not to suggest they’re obscure companies – some of the “toxic stocks” I’m going to name for you are in fact regularly in the headlines for other reasons, often in glowing terms.
I’m going to run down the list and give you the chance to learn the names of three companies I think everyone should own instead.
But first, if you own any or all of these “toxic stocks,” sell them today…
Mullen Automotive (MULN)
Mullen is in a tight spot. The stock has been slipping, breaking through crucial support levels. Investors are eyeing a key decision on December 15, where CEO David Michery will push for a third reverse stock split this year, a move to cling onto Nasdaq listing standards. This isn’t new territory for Mullen; they’ve been down this reverse split road before.
The latest proposal? A reverse split ranging from 1-for-2 to 1-for-100, all to dodge a Nasdaq delisting. They’ve got until January 22, 2024, to keep their share price above $1 for 20 straight trading days.
Here’s the deal: Mullen’s repeated reverse split strategy smacks of desperation. Sure, it might stave off delisting, but let’s not forget, Mullen is still a speculative play, a zero-revenue newcomer in a cutthroat market. My advice? Tread carefully. There are more stable, profitable options out there than betting on MULN’s shaky ground.
Canada Goose (GOOS)
Canada Goose just hit a rough patch. They’ve slashed their annual sales outlook, pointing to persistent struggles in crucial markets like China and the U.S. The recovery in China? Still a big question mark.
Here’s the lowdown: Canada Goose now expects fiscal 2024 revenue to be between $1.20 billion and $1.40 billion. That’s a step down from their earlier forecast of $1.40 billion to $1.50 billion. The market reacted swiftly – the stock tumbled nearly 10% following this announcement. Year-to-date, GOOS stock has plummeted 40%, skirting dangerously close to an all-time low of just under $10 a share.
Analysts are chiming in, and the consensus isn’t great. They’re suggesting that Canada Goose might be losing its edge. The reason? A declining demand for winter parkas, thanks in part to a warming planet. It seems this Goose might be losing its feathers in the market’s chilly climate.
AMC (AMC)
AMC is facing a tough time, with its shares continuing to drop. This downturn is fueled by a mix of lackluster business performance and some questionable choices by the management, leaving investors less than impressed.
AMC did post a rare profit in its recent quarterly earnings. However, moviegoers are still scarce, with attendance down 16% compared to pre-pandemic levels in 2019, despite a few blockbuster releases.
But here’s the catch – even with this small profit, AMC is scrambling for cash to manage its hefty debts. Their solution? Another stock offering, which only adds to the woes of their already beleaguered shareholders. And let’s not overlook their investment decisions, like pouring money into the struggling Hycroft Mining (HYMC). These moves aren’t exactly helping AMC’s chances of a turnaround. The path ahead for this cinema giant looks challenging.
