This assessment underscores the importance of thorough analysis and strategic decision-making in the ever-changing landscape of the stock market. Investors are advised to exercise caution and consider diversifying their portfolios to mitigate potential risks associated with these underweight stocks. Barclays' insights serve as a valuable resource for investors seeking to navigate the complexities of the financial markets and make informed investment choices.
Barclays analysts have forecasted that the sell-off in popular U.S. stocks, including Apple, is far from over and could lead to significant declines in the coming months. President Donald Trump's tariff policies and recent jobs data have raised concerns about inflation and a potential economic slowdown, causing major stock averages like the S&P 500 and Dow Jones Industrial Average to experience their worst weeks since September. The tech-heavy Nasdaq Composite also saw a significant drop, indicating a correction in the market.
Market Uncertainties and Stock Performance
Amidst market uncertainties, triggered by President Donald Trump's tariff policies and last week's jobs data, concerns about inflation and a potential economic slowdown loom large.
As investors navigate through this uncertain period, Barclays has identified several stocks that they believe are no longer attractive and could see substantial downside. Apple, for example, could face an 18% decline based on Barclays' price target of $197. The company's heavy reliance on Chinese manufacturing and the impact of Trump's tariffs have raised concerns about its future performance.
Stock Averages Experience Significant Pullback
The S&P 500 and Dow Jones Industrial Average both retreated by over 2% last week, while the Nasdaq Composite, led by AI-related companies, saw a more than 3% decline.
Another stock that Barclays analysts are bearish on is Domino's Pizza, which they believe could be overvalued after a 12.5% increase this year. The pizza chain's recent fourth-quarter report fell short of Wall Street expectations, signaling a potential downturn in its stock price.Online travel company TripAdvisor is also on Barclays' radar, with an 8% projected downside from its current price of about $13.
Barclays' View on Unattractive Stocks
Additionally, UPS and Garmin are among the stocks that Barclays rates as underweight, with UPS facing challenges such as lower post-Covid package volumes and higher labor costs, leading to a more than 21% decline over the past year despite the overall market performance.With uncertainties looming over the market, investors are advised to carefully consider their stock picks and be prepared for potential challenges ahead.
Barclays forecasts that the sell-off in popular U.S. stocks, including Apple, is far from over and could lead to significant losses in the coming months. Barclays has identified several stocks that it deems unattractive, including Apple, which could potentially drop by nearly 18% based on the bank's price target of $197.
Apple's Concerns Over Tariffs
Apple faces mounting concerns over the impact of Trump's tariffs on its products, as the company heavily relies on Chinese manufacturing.
Domino's Pizza and TripAdvisor in Focus
Barclays also highlights Domino's Pizza and TripAdvisor as stocks that could see significant declines in the near future.
Underweight Ratings on UPS and Garmin
UPS and Garmin are among the companies that Barclays rates as underweight due to various challenges affecting their performance.
