We recently compiled a list of the 15 worst 52-week low-priced stocks to buy now, according to short sellers. In this article, we’ll take a look at how Navitas Semiconductor Corporation (NASDAQ:NVTS) stands compared to other 52-week worst-priced stocks.
The US Federal Reserve’s 50 basis point interest rate cut was the trigger that stocks needed to recover from their stagnation. After weeks and months of uncertainty about what the Fed will do, certainty is slowly creeping into the market, leading to heightened investor sentiment.
While the S&P 500 index is back to record highs, the biggest mover has been the Nasdaq 100 index, which rose more than 3% after a 50 basis point interest rate cut. The sharp rise in tech-heavy U.S. indexes is a clear sign that tech stocks are poised to inch higher after weeks of weakness.
The interest rate cut is expected to have a positive impact on banks’ short-term borrowing costs, making it easier for people and businesses to access cheap funds to boost economic activity, which has slowed in recent months. It should also have a positive impact on a range of consumer products, including mortgages, auto loans and credit cards.
Fed Chairman Jerome Powell reiterated that the 50 basis point rate cut was all about “rebalancing” the economy amid concerns that the U.S. economy is slowing after disappointing jobs numbers and a slowdown in manufacturing. Ta.
Photo by Humberto on Unsplash
Initially, there were concerns that if the Fed decided to cut interest rates by 50 basis points, it would heighten concerns about the health of the U.S. economy and cause stock prices to fluctuate as a result. But that wasn’t the case, as stock prices rose, showing investors were optimistic about the long-term outlook for the economy and markets.
Tom Porcelli, PGIM’s top U.S. economist for fixed income policy, believes the Fed’s policy was set up to deal with greater inflation. Now that inflation is nearing its target, the Fed can begin to ease the tight monetary policy it has been applying. Therefore, aggressive interest rate cuts are not because we are facing a recession, but because we want to maintain economic growth.
This year, the focus is on stocks that have been slowly rising, but the focus is gradually shifting to stocks that have bottomed out or for which market participants are becoming bearish. Stocks, which have hit 52-week lows, are looking increasingly cheap, especially as monetary policy improves after months of uncertainty. Still, it’s unclear whether stocks with high short-term interest rates will bounce back after coming under heavy pressure over the past nine months.
the story continues
With the Fed cutting interest rates significantly, CNBC commentator and Fast Money host Jim Cramer says investors should start focusing on stocks that are poised to benefit from the low interest rate environment. I think there is. Stocks to consider include companies that provide products or services that rely on consumer purchasing power.
So let’s take a look at the worst 52-week low stocks to buy now, according to short sellers.
our methodology
We used the Finviz screener to find stocks that were trading near their 52-week lows and had high short interest (at least 5%). We then selected the stocks with the highest short interest and ranked them in ascending order of this metric. We’ve also added hedge fund sentiment towards these stocks.
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Navitas Semiconductor Corp (NASDAQ:NVTS)
52 week range: $2.2 – $8.4
Current stock price: $2.4
Short % of shares outstanding: 15.21%
Number of hedge funds holding the stock as of Q2 2024: 15
Navitas Semiconductor Corp (NASDAQ:NVTS) is a semiconductor company that designs, develops and markets integrated circuits related to high-speed silicon system controllers and digital isolators for power conversion and charging. Its products are mainly used in mobile, consumer, data centers, solar power, electric vehicles, and industrial motor drives.
Navitas Semiconductor Corp (NASDAQ:NVTS) is expanding its footprint in the AI data center and electric vehicle space, with more than 200 client projects and a string of design wins. The company expects to have its first Gann EV revenue by the end of the year. Despite the downturn in the solar power sector, Navitas is moving forward, with more than 100 projects underway.
The stock has been under pressure for much of this year due to growing concerns about consumer spending on the company’s core products. Additionally, the company faces stiff competition from Chinese companies amid mixed messages from the auto industry.
Additionally, Navitas Semiconductor Corporation (NASDAQ:NVTS) sentiment on Wall Street has taken a big hit due to a management shake-up. Concerns are rising after it was confirmed that current CFO and Treasurer Janet Chow is planning to resign in October. The company was forced to say that the current CFO’s departure has no bearing on financial statements or disclosures.
The company achieved sales of $20.5 million in the second quarter of 2024 thanks to gallium nitride, a 40% year-on-year increase, but struggled to turn a profit. As a result, the company reported a net operating loss of $13.3 million. ”
Short interest in the stock rose to 15.21% as Navitas seeks to improve its financial health and management transition. Through the end of June, 15 funds held long positions in Navitas Semiconductor Corporation (NASDAQ:NVTS), up from 11 funds last quarter.
Overall, NVTS ranks #4 on our list of worst 52-week low-priced stocks to buy. While we recognize the potential of NVTS as an investment, we believe AI stocks are more likely to deliver higher returns in a shorter time frame. If you’re looking for more promising AI stocks than NVTS, check out our report on the cheapest AI stocks.
Read next: $30 trillion opportunity: 15 humanoid robot stocks to buy, according to Morgan Stanley and Jim Cramer, says NVIDIA has ‘become a wasteland.’
Disclosure: None. This article was originally published on Insider Monkey.
