U.S. equities rolled over sharply to the downside Wednesday, snapping a steady uptrend going back to late June. The catalyst for the mini-selloff? The emerging market currency crisis shifts in focus from Turkey to China as the yuan crumbles.
That’s spilling into global growth concerns as the yuan trends toward 10-year lows against the dollar.
The move was spurred by weak results from Chinese game maker Tencent (OTCMKTS:TCHEY) resulting in sympathetic selling. As a result, investors targeted U.S. big-cap tech stocks, which have single-handedly bolstered broad market averages in recent months.
While the Nasdaq Composite is up half a percent Thursday morning, yesterday’s weakness underscores bigger problems for investors who have continued to assume that their favorite “can’t lose” tech giants would rise no matter what. Here are seven tech stocks to consider cutting loose today:
Troubled Tech Stocks: Facebook (FB)
Facebook (NASDAQ:FB) shares are testing back below their 200-day moving average, succumbing to new post-earnings selling pressure after the company reported weaker-than-expected user growth and warned of constrained profit margins going forward.
The spell of “social forever” was broken, as investors realized Facebook’s best days may now be behind it.
The company will next report results on Oct. 31 after the close. Analysts are looking for earnings of $1.53 per share on revenues of $13.8 billion. When the company last reported on July 25, earnings of $1.74 per share beat estimates by four cents on a 42% rise in revenues.
Troubled Tech Stocks: Twitter (TWTR)
Twitter (NYSE:TWTR) shares are threatening to fall below their 200-day moving average hanging onto critical resistance near the lows seen back in March-June.
The company has been at the center of a political firestorm regarding alleged silencing and censoring of conservative voices via techniques like “shadow banning,” which the company has denied.
The company will next report results on Oct. 25 before the bell. Analysts looking for earnings of 14 cents per share on revenues of nearly $700 million. When the company last reported on July 27, earnings of 17 cents beat estimates by a penny on a 23.8% rise in revenues.
Troubled Tech Stocks: Intel (INTC)
Intel (NASDAQ:INTC) shares are falling away from their 200-day moving average, threatening to break below their late July low and return to levels not seen since February.
Analysts at Cowen recently lowered their price target amid ongoing worries about its future processor roadmap.
The company will next report results on Oct. 25 after the close. Analysts are looking for earnings of $1.15 per share on revenues of $18.1 billion. When the company last reported on July 26, earnings of $1.04 beat estimates by seven cents on a 14.9% rise in revenues.
Troubled Tech Stocks: Netflix (NFLX)
Netflix (NASDAQ:NFLX) shares are dropping below their late July low to return to levels last seen in May. This caps a 23% fall from its early July highs.
Analysts at Imperial Capital recently lowered their price target on a lowered subscriber growth estimate. Shares have been under pressure since management disappointed with weak subscriber numbers.
The company will next report results on Oct. 15 after the close. Analysts are looking for earnings of 68 cents per share on revenues of $4 billion. When the company last reported on July 16, earnings of 85 cents per share beat estimates by six cents on a 40.3% rise in revenues.
Anthony Mirhaydari is the founder of the Edge (ETFs) and Edge Pro (Options) investment advisory newsletters. Free two- and four-week trial offers have been extended to InvestorPlace readers.
