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The bears have been shorting Real Estate stocks for over a year.
Two notable large cap Real Estate stocks -- found in Zacks Sub-Financials Sector 52 -- are Prologis (PLD - Free Report) and Brookfield (BN - Free Report) .
Their share price, consensus & surprise charts are shown below.
Confirm: Stock traders have been proactive in shooting both of these two stocks down:
Image Source: Zacks Investment Research
Image Source: Zacks Investment Research
In light of a Regional Banking crisis, let’s also study the Zacks.com consensus earnings, price & surprise charts of two Regional Bank stocks.
One Regional Bank’s share price did well in March 2023. Of course, this one is the bank the FDIC partnered with, to buy the failed Silicon Valley Bank (SVB) at the center of the crisis. First Citizens (FCNCA - Free Report) shares went from $505 in early March, to a stunning $973 in early April. However, before the SVB crisis, they range-traded around $850.
The next chart shows the set-up on First Citizens Bancshares:
Image Source: Zacks Investment Research
Now, for a West Coast bank that got caught up in the Regional Bank crisis?
A good one is East West Bancorp (EWBC - Free Report) . Their annual earnings look good below.
Image Source: Zacks Investment Research
What does a long-term investor, or short-term trader, do about shares like EWBC now?
The bull answer is to “buy when there is blood on the streets” -- meaning buy now.
The bear response is “there will another shoe to drop” -- meaning stay away.
II. Zacks April Sector/Industry/Company Telescope
Here is what we learned from the March 31st Zacks Industry Ranks:
Info Tech rose to a Very Attractive from Market Weight. Semis are back on top.
Industrials also stays on as a Very Attractive sector. The Health Care sector stays at Very Attractive too.
Consumer Staples and Consumer Discretionary fall back to Market Weights this month. This is important. Consumer spending may well be cooling off.
Utilities, Materials, and the Energy sector remain grouped at Market Weight. Ditto Financials at Market Weight.
Communication Services is at the back. But it is only Unattractive.
(1) Info Tech rose to Very Attractive from Market Weight. Semis are back on top.
(3) Industrials stayed Very Attractive. Metal Fabricating, Pollution Control, Machinery, and Industrial Products-Services stayed hot, again.
Zacks #1 Rank Stock: Ingersoll Rand (IR - Free Report)
(4) Consumer Staples fell to Market Weight from Very Attractive. Misc-Staples, Beverages, and Soaps & Cosmetics, look the best.
(5) Consumer Discretionary fell to Market Weight from Very Attractive. Publishing, Leisure Services, and Apparel look the best.
(6) Utilities stays at Market Weight. Utilities-Telephone looks the best.
(7) Materials stays at Market Weight. Steel looks best.
(8) Energy stays at Market Weight. Coal & Drillers & Pipelines look best, at market.
(9) Financials stays at Market Weight. Major Banks stays at the top.
(10) Communications Services rises back to Market Weight.
III. Conclusion
Given the stoked fears out there, I would bet on Finance Sector stocks in Real Estate and Regional Banking to remain a short-term trader focus for some time.
Is there a long-term investor trick to apply?
Yes.
The trick comes with trying to figure out when their beaten-down share prices bottomed.
Be patient.
Enjoy the rest of Zacks April 2023 market strategy report.
Warm Regards,
John Blank Zacks Chief Equity Strategist and Economist
See More Zacks Research for These Tickers
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Image: Bigstock
The Bears Short Real Estate Stocks: Zacks April Strategy
The following is an excerpt from Zacks Chief Strategist John Blank’s full Apr Market Strategy report To access the full PDF, click here.
Mr. Market often prices in the future -- now.
I. A Time to Study Stock Charts
The bears have been shorting Real Estate stocks for over a year.
Two notable large cap Real Estate stocks -- found in Zacks Sub-Financials Sector 52 -- are Prologis (PLD - Free Report) and Brookfield (BN - Free Report) .
Their share price, consensus & surprise charts are shown below.
Confirm: Stock traders have been proactive in shooting both of these two stocks down:
Image Source: Zacks Investment Research
Image Source: Zacks Investment Research
In light of a Regional Banking crisis, let’s also study the Zacks.com consensus earnings, price & surprise charts of two Regional Bank stocks.
One Regional Bank’s share price did well in March 2023. Of course, this one is the bank the FDIC partnered with, to buy the failed Silicon Valley Bank (SVB) at the center of the crisis. First Citizens (FCNCA - Free Report) shares went from $505 in early March, to a stunning $973 in early April. However, before the SVB crisis, they range-traded around $850.
The next chart shows the set-up on First Citizens Bancshares:
Image Source: Zacks Investment Research
Now, for a West Coast bank that got caught up in the Regional Bank crisis?
A good one is East West Bancorp (EWBC - Free Report) . Their annual earnings look good below.
Image Source: Zacks Investment Research
What does a long-term investor, or short-term trader, do about shares like EWBC now?
The bull answer is to “buy when there is blood on the streets” -- meaning buy now.
The bear response is “there will another shoe to drop” -- meaning stay away.
II. Zacks April Sector/Industry/Company Telescope
Here is what we learned from the March 31st Zacks Industry Ranks:
Info Tech rose to a Very Attractive from Market Weight. Semis are back on top.
Industrials also stays on as a Very Attractive sector. The Health Care sector stays at Very Attractive too.
Consumer Staples and Consumer Discretionary fall back to Market Weights this month. This is important. Consumer spending may well be cooling off.
Utilities, Materials, and the Energy sector remain grouped at Market Weight. Ditto Financials at Market Weight.
Communication Services is at the back. But it is only Unattractive.
(1) Info Tech rose to Very Attractive from Market Weight. Semis are back on top.
Zacks #1 Rank Stock: Baidu (BIDU - Free Report)
(2) Health Care stayed Very Attractive. Medical Care and Medical Products lead again.
Zacks #1 Rank Stock: Biorad Laboratories (BIO - Free Report)
(3) Industrials stayed Very Attractive. Metal Fabricating, Pollution Control, Machinery, and Industrial Products-Services stayed hot, again.
Zacks #1 Rank Stock: Ingersoll Rand (IR - Free Report)
(4) Consumer Staples fell to Market Weight from Very Attractive. Misc-Staples, Beverages, and Soaps & Cosmetics, look the best.
(5) Consumer Discretionary fell to Market Weight from Very Attractive. Publishing, Leisure Services, and Apparel look the best.
(6) Utilities stays at Market Weight. Utilities-Telephone looks the best.
(7) Materials stays at Market Weight. Steel looks best.
(8) Energy stays at Market Weight. Coal & Drillers & Pipelines look best, at market.
(9) Financials stays at Market Weight. Major Banks stays at the top.
(10) Communications Services rises back to Market Weight.
III. Conclusion
Given the stoked fears out there, I would bet on Finance Sector stocks in Real Estate and Regional Banking to remain a short-term trader focus for some time.
Is there a long-term investor trick to apply?
Yes.
The trick comes with trying to figure out when their beaten-down share prices bottomed.
Be patient.
Enjoy the rest of Zacks April 2023 market strategy report.
Warm Regards,
John Blank
Zacks Chief Equity Strategist and Economist