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Should You Buy Stocks with Negative Earnings?

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  • (0:45) - Should You Buy Companies With Negative Earnings?
  • (5:15) - The Battle To Positive Earnings: Hot Stocks That Had Negative Earnings
  • (9:20) - Stocks To Keep On Your Radar: Tracey’s Top Picks
  • (20:40) - Episode Roundup: TSLA, AMZN, TWLO, ROKU, UBER, ABNB, M, OXY, EXAS
  •                Podcast@Zacks.com

 

Some of the hottest companies on Wall Street have negative earnings. Should you buy them?

Description:

Welcome to Episode #260 of the Zacks Market Edge Podcast.

Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life.

This week, Tracey is going solo to look into the question of buying the stock of companies that have negative earnings.

In the past, some companies with negative earnings, which later went positive, have gone on to be darlings of Wall Street.

Amazon (AMZN - Free Report) is one of the best performing S&P 500 stocks of the last 30 years but it started off its first few years with negative earnings.

Tesla (TSLA - Free Report) only went earnings positive last year, in 2020.

Still in the Negative in 2021

Some companies that currently have negative earnings have been the hottest on Wall Street.

1.       Twilio (TWLO - Free Report) is up 229% over the last year to new 5-year highs. But it’s had negative earnings every year since it’s 2016 IPO.

2.       Roku, Inc. (ROKU - Free Report) has also been hot, gaining 259% in the last year. In 2020, it was expected to lose $0.78 and analysts expect it to lose $0.50 again in 2021.

3.       Uber Technologies (UBER - Free Report) has a plan to get earnings positive. Analysts expect it to happen by 2023. Will it?

What else do you need to know about buying companies with negative earnings?

Listen to this week’s podcast to find out.

[In full disclosure, Tracey owns shares of AMZN in her personal portfolio.]

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

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