If you’re looking to free up capital you might be looking for stocks to sell in your portfolio.
One of the interesting things about the stock market is that only some names are winners. Some of them may be good companies, to be sure, but the timing for them isn’t the best. These are stocks to sell right away.
The occasional rebalancing is essential, even if you’re a buy-and-hold investor, you want to be on the lookout got stocks to sell to keep your returns out of the red.
Here, I’ve used the Portfolio Grader tool to help identify some stocks to sell immediately.
The Portfolio Grader evaluates stocks on various measurements, including recent performance, momentum, earnings and analyst sentiment.
Stocks with an “A” grade go to the head of the class. Stocks that have an “F” grade are the ones holding your portfolio back.
Here are seven stocks to sell in April before the month gets too far along.
|FRC||First Republic Bank||$14.03|
|KRC||Kilroy Realty Corporation||$32.13|
First Republic Bank (FRC)
San Francisco-based First Republic Bank (NYSE:FRC) is in serious trouble. The bank is threatening to become the third financial institution to fail this year, coming on the heels of SVB Financial Group (OTCMKTS:SIVBQ) subsidiary Silicon Valley Bank and Signature Bank (OTCMKTS:SBNY).
The bank, which caters to wealthy clients similar to Silicon Valley Bank, saw a run of depositors withdrawing uninsured deposits last month.
Eleven of the biggest U.S. banks came up with a rescue package of $30 billion in uninsured deposits to keep First Republic going, but that didn’t keep shares from falling 60% in a single day.
First Republic had too many uninsured deposits and got into a mess similar to Silicon Valley and Signature. The bank is trying to get back on track, but it’s already suspended its dividend, and investors expect deep losses when it next reports quarterly earnings.
Revenues for the first quarter are expected at $1.13 billion, an 18% drop from a year ago. EPS is expected to be a loss of $4.18 per share.
FRC stock is down 88% this year, and investors are lucky the bank is still solvent. FRC stock roundly deserves its “F” rating in the Portfolio Grader.
If you’re holding Intel (NYSE:INTC) stock, you probably feel a little burned these days. Intel cut its dividend payout by 66% in February to conserve the cash it needs to fund its turnaround.
That might be fine if investors were assured that the money would be reinvested wisely and that Intel, down 31% in the last year, would bounce back. But there are no guarantees.
Intel is rapidly losing market share to competitor Advanced Micro Devices (NASDAQ:AMD). Its market share dropped from 82% in 2018 to 62% in 2022 because of the popularity of AMD’s Ryzen chips.
If Intel’s earnings performance remains underwhelming, investors will have a stagnant stock that suddenly doesn’t pay a good dividend. So what’s the point of holding the stock any longer?
There isn’t. INTC stock has an “F” rating in the Portfolio Grader.
PacWest Bancorp (PACW)
First Republic isn’t the only regional bank that’s having troubles this month. PacWest Bancorp (NASDAQ:PACW) acknowledged in a statement that its Federal Deposit Insurance Corporation insured deposits exceed 65% of total deposits and that community bank deposits were down 10.6% at the end of 2022 to $15.1 billion.
It announced it borrowed $3.7 billion from the Federal Home Loan Bank system, $10.5 billion from the Federal Reserve Discount Window and $2.1 billion from the Bank Term Funding Program in March.
But it won’t raise further capital by trying to sell stock, citing depressed stock prices for regional bank shares.
Not surprisingly, those shares are being punished even further. PACW stock is down 57% this year, including a 5% loss since bank officials issued their statement to try to ward off the damage.
Regional banks are generally acceptable, but these entities overextended on uninsured deposits are not good gambles this month. That makes PacWest one of our stocks to sell.
Credit Suisse (CS)
The banking problems are not limited to U.S. soil. In Europe, the Swiss Central Bank was forced to loan Credit Suisse (NYSE:CS) $54 billion last month to stabilize it from collapse.
That wasn’t a shock to people watching the stock closely. Last year Credit Suisse lost $7.9 billion, which was its most significant loss since the global financial crisis. Its stock lost 84% of its value over the last two years.
Even with the loan, however, the bank said it couldn’t rule out bankruptcy, so regulators pushed fellow Swiss bank UBS (NYSE:UBS) to buy Credit Suisse in a takeover.
The deal is valued at $3.25 billion, or roughly 60% less than Credit Suisse was valued at just a few days before the announced takeover.
If you owned Credit Suisse stock, you were out of luck – shareholders were receiving 0.76 Swiss francs (about 8.4 cents) per share for stock valued at more than $2 per share.
The takeover is expected to close by the end of the year. Until then, there’s no need to hold CS stock, which has an “F” rating in the Portfolio Grader.
Silvergate Capital (SI)
There’s no need to stay on a sinking ship, and that’s what Silvergate Capital (NYSE:SI) is right now. The crypto bank announced in March that it was shutting down operations and liquidating.
It says the liquidation plan includes full repayment of deposits – a faint silver lining in a very dark cloud.
The company’s stock is down 91% so far this year and at one point started a minor recovery as short speculators began getting excited about the stock’s short interest of 71%. But I’m not looking for a short squeeze here; you shouldn’t be as well.
Crypto banks are risky investments, and I agree that some calculated risks are OK. But to put new money into SI stock right now is just a fool’s errand.
If you’re still holding onto your Silvergate Capital stock in hopes that you can get a miracle boost of profits – you’re sorely mistaken.
SI stock has an “F” rating in the Portfolio Grader.
Offerpad Solutions (OPAD)
Offerpad Solutions (NYSE:OPAD) is an online home-buying service. The company pays cash for people looking to sell their homes quickly – the hope for investors is that Offerpad can lowball sellers, then put a little money into homes and sell them at a profit.
But high interest rates make the home-buying market less appealing than it was a year or two ago.
Sure, maybe people who have a variable rate mortgage are now getting squeezed and are desperate to sell. But that doesn’t mean that Offerpad can flip those homes to new buyers any quicker until interest rates drop again.
Revenue in the fourth quarter was $677.2 million, down 21% from a year ago. The company also reported losing $44.9 million in the quarter, compared to a profit of $70.3 million in the same quarter a year earlier.
Offerpad is an incredibly risky stock priced at roughly 50 cents per share – down 13% this year. Stay away from this one; it has an “F” rating in the Portfolio Grader.
Kilroy Realty Corporation (KRC)
Kilroy Realty Corporation (NYSE:KRC) is a real estate investment trust that operates in the office REIT sector. That’s not a great place to be following the coronavirus pandemic.
There are a lot of businesses that are still either fully remote or offering hybrid working environments. And it’s only a matter of time before companies realize that the workforce has changed for good.
There’s no need for them to continue to lease massive offices and building spaces for a workforce that can be productive from home.
Secondly, Kilroy’s holdings include properties in San Diego and San Francisco – the latter in the middle of Silicon Valley, which is highly volatile. (Remember Silicon Valley Bank’s failure – many tech companies had exposure.)
REITs traditionally have been excellent investments for income investors because of the unusual tax structure. They are required to return 90% of profits to shareholders as a dividend. But I wouldn’t be too excited to hold an office REIT right now, particularly once that’s so concentrated in Silicon Valley.
KRC stock has an “F” rating in the Portfolio Grader.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.