Short stock ideas from each sector with Earnings Quality in the bottom 20%

Wolfe Research analysts put together the bottom 20% stocks among the Earnings Quality model ranking.

This model is designed to identify potential accounting related “blow-ups,” or short ideas, based on weighted metrics and scores each company on a sector relative 0-100 basis, said Chris Senyek, chief investment strategist at Wolfe Research.

The following are the bottom five “Earnings Quality” stocks, divided by their sector.

Communication services

1. The Trade Desk (TTD) – Earnings Quality score: 0
2. Sirius XM Holdings (SIRI) – Earnings Quality score: 1
3. Yelp (YELP) – Earnings Quality score: 2
4. ZoomInfo Technologies (ZI) – Earnings Quality score: 3
5. The Interpublic Group of Companies (IPG) – Earnings Quality score: 4

Consumer discretionary

1. eBay (EBAY) – Earnings Quality score: 0
2. Wyndham Hotels (WH) – Earnings Quality score: 0
3. Restoration Hardware Holdings (RH) – Earnings Quality score: 1
4. YETI Holdings (YETI) – Earnings Quality score: 1
5. Mister Car Wash (MCW) – Earnings Quality score: 2

Consumer staples

1. e.l.f. Beauty (ELF) – Earnings Quality score: 0
2. Keurig Dr. Pepper (KDP) – Earnings Quality score: 1
3. Grocery Outlet Holdings (GO) – Earnings Quality score: 2
4. The Coca-Cola Co. (KO) – Earnings Quality score: 3
5. The J.M. Smucker Co. (SJM) – Earnings Quality score: 4

Energy

1. Vital Energy (VTLE) – Earnings Quality score: 0
2. Golar LNG Limited (GLNG) – Earnings Quality score: 1
3. Expro Group Holdings (XPRO) – Earnings Quality score: 1
4. New Fortress Energy (NFE) – Earnings Quality score: 3
5. Bistow Group (VTOL) – Earnings Quality score: 3

Financials

1. StoneCo Limited (STNE) – Earnings Quality score: 0
2. Coinbase Global (COIN) – Earnings Quality score: 8
3. Paymentus Holdings (PAY) – Earnings Quality score: 11
4. Shift4 Payments (FOUR) – Earnings Quality score: 17
5. Tradeweb Markets (TW) – Earnings Quality score: 19

Health care

1. Neurocrine Biosciences (NBIX) – Earnings Quality score: 0
2. Halozyme Therapeutics (HALO) – Earnings Quality score: 0
3. Eli Lilly and Co. (LLY) – Earnings Quality score: 1
4. Intuitive Surgical (ISRG) – Earnings Quality score: 1
5. Sarepta Therapeutics (SRPT) – Earnings Quality score: 1

Industrials

1. FTAI Aviation Limited (FTAI) – Earnings Quality score: 0
2. Oshkosh Corp. (OSK) – Earnings Quality score: 0
3. Concentrix (CNXC) – Earnings Quality score: 0
4. Beacon Roofing Supply (BECN) – Earnings Quality score: 1
5. Terex Corp. (TEX) – Earnings Quality score: 1

Information technology

1. Synopsys (SNPS) – Earnings Quality score: 0
2. InterDigital (IDCC) – Earnings Quality score: 0
3. First Solar (FSLR) – Earnings Quality score: 1
4. IonQ (IONQ) – Earnings Quality score: 1
5. Five9 (FIVN) – Earnings Quality score: 1

Materials

1. Valvoline (VVV) – Earnings Quality score: 0
2. Graphics Packaging Holding (GPK) – Earnings Quality score: 1
3. United States Steel Corp. (X) – Earnings Quality score: 2
4. Materion Corp. (MTRN) – Earnings Quality score: 2
5. Aspen Aerogels (ASPN) – Earnings Quality score: 3

Utilities

1. Constellation Energy (CEG) – Earnings Quality score: 0
2. Avangrid (AGR) – Earnings Quality score: 3
3. The AES Corp. (AES) – Earnings Quality score: 4
4. Vistra Energy Corp. (VST) – Earnings Quality score: 5
5. Eversource Energy (ES) – Earnings Quality score: 7