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Philip van Doorn

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May 31, 2019, 8:57 a.m. EDT

These 6 stocks in the S&P 500 are down at least 50% — and analysts say buy

Overall, 14 stocks among the S&P 500 are down at least 50% from their 52-week highs

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By Philip van Doorn, MarketWatch


Bloomberg
Nvidia CEO Jen-Hsun Huang. The company’s stock is down 50% from the 52-week high it set in October.

May has been a reversal for what has otherwise been a good 2019 for U.S. stocks. It may be an opportunity to consider which stocks may have fallen too much, in your view, and may now present buying opportunities.

Here’s how major indexes have performed this month and for 2019:

Price changes
Index April 30 through May 24 2019 Fourth quarter, 2018
Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -3.8% 9.7% -11.8%
S&P 500 index /zigman2/quotes/210599714/realtime SPX -4.2% 12.7% -14.0%
Nasdaq Composite Index /zigman2/quotes/210598365/realtime COMP -6.0% 15.1% -17.5%
Source: FactSet

Biggest large-cap ‘losers’

These 14 stocks among the S&P 500 are down at least 50% from their 52-week highs:

Company Ticker Industry Closing price - May 24 52-week high Date of 52-week high Decline from 52-week high
Nektar Therapeutics /zigman2/quotes/206715615/composite NKTR Biotechnology $33.79 $92.17 06/01/2018 -63.3%
CenturyLink Inc. Telecommunications $10.11 $24.20 08/21/2018 -58.2%
Halliburton Co. /zigman2/quotes/210488727/composite HAL Oilfield Services/Equipment $22.97 $52.61 05/24/2018 -56.3%
Mylan N.V. Generic Pharmaceuticals $18.98 $42.50 06/13/2018 -55.3%
National Oilwell Varco Inc. /zigman2/quotes/208758290/composite NOV Oilfield Services/Equipment $22.39 $49.08 07/31/2018 -54.4%
Western Digital Corp. /zigman2/quotes/204213617/composite WDC Computer Peripherals $40.98 $88.62 05/24/2018 -53.8%
Kraft Heinz Co. /zigman2/quotes/203625533/composite KHC Food: Major Diversified $31.11 $64.99 08/03/2018 -52.1%
Fluor Corp. /zigman2/quotes/203795934/composite FLR Engineering & Construction $29.04 $60.60 10/02/2018 -52.1%
HollyFrontier Corp. Oil Refining/Marketing $41.11 $83.28 06/04/2018 -50.6%
Nordstrom Inc. /zigman2/quotes/203902116/composite JWN Apparel/Footwear Retail $33.50 $67.75 11/06/2018 -50.5%
Nvidia Corp. /zigman2/quotes/200467500/composite NVDA   Semiconductors $145.15 $292.76 10/02/2018 -50.4%
Activision Blizzard Inc. /zigman2/quotes/200717283/composite ATVI Recreational Products $42.29 $84.68 10/01/2018 -50.1%
Macy's Inc /zigman2/quotes/201854387/composite M Department Stores $21.01 $41.99 08/14/2018 -50.0%
IPG Photonics Corp. /zigman2/quotes/203325788/composite IPGP Electronic Equipment/Instruments $131.01 $261.77 06/07/2018 -50.0%
Source: FactSet

It is a diverse list, and you can click the tickers for news coverage and more information about each company.

Here’s a summary of analysts’ opinions about these companies. A majority of analysts have buy recommendation on six of them:

Company Ticker Share 'buy' ratings Share neutral ratings Share 'sell' ratings Closing price - May 24 Consensus price target Implied 12-month upside potential
Nektar Therapeutics /zigman2/quotes/206715615/composite NKTR 71% 29% 0% $33.79 $69.50 106%
CenturyLink Inc. 18% 70% 12% $10.11 $12.80 27%
Halliburton Co. /zigman2/quotes/210488727/composite HAL 88% 12% 0% $22.97 $38.18 66%
Mylan N.V. 68% 32% 0% $18.98 $29.63 56%
National Oilwell Varco Inc. /zigman2/quotes/208758290/composite NOV 35% 52% 13% $22.39 $29.36 31%
Western Digital Corp. /zigman2/quotes/204213617/composite WDC 42% 48% 10% $40.98 $53.91 32%
Kraft Heinz Co. /zigman2/quotes/203625533/composite KHC 10% 75% 15% $31.11 $35.67 15%
Fluor Corp. /zigman2/quotes/203795934/composite FLR 36% 64% 0% $29.04 $34.33 18%
HollyFrontier Corp. 22% 61% 17% $41.11 $55.13 34%
Nordstrom Inc. /zigman2/quotes/203902116/composite JWN 17% 70% 13% $33.50 $38.59 15%
Nvidia Corp. /zigman2/quotes/200467500/composite NVDA 58% 36% 6% $145.15 $183.30 26%
Activision Blizzard Inc. /zigman2/quotes/200717283/composite ATVI 66% 34% 0% $42.29 $52.71 25%
Macy's Inc /zigman2/quotes/201854387/composite M 18% 59% 23% $21.01 $23.93 14%
IPG Photonics Corp. /zigman2/quotes/203325788/composite IPGP 53% 47% 0% $131.01 $190.83 46%
Source: FactSet

Each company has a different story, of course, which you must understand as part of your own research if you wish to do some “bottom feeding.”

For example, you might have a particular opinion about the (potential) resolution of the trade conflict between the U.S. and China, and its timing. Michael Brush, for one, believes it’s time to invest in semiconductor stocks and other select industries in anticipation of a trade agreement.

Also read: Nvidia stock falls after earnings fail to change any minds

You can get broad exposure to semiconductors, while cutting the risk associated with an individual stock, through broad exchange-traded funds that include the iShares PHLX Semiconductor ETF /zigman2/quotes/209255350/composite SOXX +0.99%  and the SPDR S&P Semiconductor ETF /zigman2/quotes/204438110/composite XSD +2.06% . Over short periods, or even within the space of a year, these aren’t for the faint of heart, as you can see with Nvidia /zigman2/quotes/200467500/composite NVDA +0.62% , down 50% from a 52-week high it set in October.

But look at the five-year total-return chart for the two ETFs named above:


FactSet

A high level of volatility is typical for semiconductor stocks, but the long-term path has been lucrative.

Don’t miss: 20 retail stocks that have two key metrics going for them in the battle against Amazon

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Philip van Doorn covers various investment and industry topics. He has previously worked as a senior analyst at TheStreet.com. He also has experience in community banking and as a credit analyst at the Federal Home Loan Bank of New York.

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