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Yahoo
10 minutes ago
- Yahoo
Goldman Traders Say It's Time to Buy the Dip in Momentum Stocks
(Bloomberg) -- Sharp losses in high-flying momentum stocks may present a dip-buying opportunity if history is any guide, according to Goldman Sachs Group Inc.'s trading desk. The traders cited rebounds after similar prior losses in Goldman's High Beta Momentum basket, coupled with the current technical setup. Why New York City Has a Fleet of New EVs From a Dead Carmaker Trump Takes Second Swing at Cutting Housing Assistance for Immigrants Chicago Schools Seeks $1 Billion of Short-Term Debt as Cash Gone Neom's Desert Ski Resort Strains Saudi Prince's $1.5 Trillion Plan When the long-short momentum basket dropped 10% or more over a five-day span in the past, it proceeded to rise in the following week 80% of the time, the traders wrote in a note to clients on Tuesday. The median return was 4.5% in the next week and more than 11% in the next month. The sudden unwind in the momentum strategy, which focuses on buying recent winners and selling short those that are lagging behind, first came amid a rally in the basket's stocks meant to be shorted. But its declines this week were powered more by losses in the long leg of the basket 'as themes such as AI feel the pain of this rotation,' Goldman's traders wrote. The basket fell 13% from Aug. 6 through Aug. 19 after trading near an all-time high. The traders also parsed through technical charts for clues on what could stop the selloff in the momentum trade. The momentum basket is trading near an oversold territory and is approaching the bottom of its so-called regression channel, which is basically the lower boundary of an existing trend. The basket also fell below its 200-day moving average, the level that could serve as a major support. 'It could be a good entry point into the historically rewarded factor, unless tech earnings next week drive a prolonged AI selloff,' Goldman's traders wrote. Nvidia Corp., the biggest member in both the S&P 500 and Nasdaq 100 indexes, is scheduled to release its quarterly results on Aug. 27. Some of the stock market's biggest losers in the past three days include Palantir Technologies Inc., which fell 12%, and Advanced Micro Devices Inc. and Super Micro Computer Inc., which lost 6% or more. Nvidia fell just 2.8% during that time, but its heavy weighting in benchmark indexes made it a drag on the market. Those stocks 'were among the year's most crowded trades, built on optimism toward AI and speculative momentum, making them vulnerable to swift reversals,' Chris Murphy, co-head of derivatives strategy at Susquehanna International Group, wrote in a note. The selloff in the momentum factor, which includes high-flying AI stocks on the long side of the basket, comes amid a variety of concerns in the market including soaring valuations, stretched positioning and increasing competition from China. The Nasdaq 100 Index is trading at 27 times expected 12-month profits, almost a third above its long-term average. Meanwhile, China's warnings to tech firms to avoid one of Nvidia's chips and a drop in cloud-computing company CoreWeave Inc.'s shares after its earnings report were among other recent headwinds to momentum stocks. Another source of concern for tech investors cropped up this week as a Massachusetts Institute of Technology report found that most generative AI initiatives implemented to drive revenue growth are falling flat and only 5% of generative AI pilots are delivering profit. Still, this isn't the only stumble for Goldman's High-Beta Momentum basket this year: This is its fourth retreat of more than 10% in 2025. 'The recent decline in momentum is indicative of how the factor has been trading all year. It's been a frustrating and choppy trade through all of 2025,' said Bloomberg Intelligence's Christopher Cain. 'While the recent decline could be a tactical opportunity, we also point out that that high momentum stocks are showing some of the most expensive valuations compared to low momentum in history.' Foreigners Are Buying US Homes Again While Americans Get Sidelined What Declining Cardboard Box Sales Tell Us About the US Economy Survived Bankruptcy. Next Up: Cultural Relevance? Women's Earnings Never Really Recover After They Have Children Americans Are Getting Priced Out of Homeownership at Record Rates ©2025 Bloomberg L.P. Sign in to access your portfolio
Yahoo
10 minutes ago
- Yahoo
3 Small-Cap Stocks We Think Twice About
Small-cap stocks can be incredibly lucrative investments because their lack of analyst coverage leads to frequent mispricings. However, these businesses (and their stock prices) often stay small because their subscale operations make it harder to expand their competitive moats. These trade-offs can cause headaches for even the most seasoned professionals, which is why we started StockStory - to help you separate the good companies from the bad. Keeping that in mind, here are three small-cap stocks to avoid and some other investments you should consider instead. (CARS) Market Cap: $740.4 million Originally started as a joint venture between several media companies including The Washington Post and The New York Times, (NYSE:CARS) is a digital marketplace that connects new and used car buyers and sellers. Why Does CARS Fall Short? Market opportunities are plateauing as its dealer customers were flat over the last two years Estimated sales growth of 2% for the next 12 months implies demand will slow from its three-year trend Falling earnings per share over the last three years has some investors worried as stock prices ultimately follow EPS over the long term At $12.05 per share, trades at 3.5x forward EV/EBITDA. Read our free research report to see why you should think twice about including CARS in your portfolio, it's free. Matthews (MATW) Market Cap: $724.2 million Originally a death care company, Matthews International (NASDAQ:MATW) is a diversified company offering ceremonial services, brand solutions and industrial technologies. Why Are We Out on MATW? Annual sales declines of 6.5% for the past two years show its products and services struggled to connect with the market Earnings per share fell by 14.8% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable Cash-burning tendencies make us wonder if it can sustainably generate shareholder value Matthews's stock price of $23.52 implies a valuation ratio of 15.4x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than MATW. CTS (CTS) Market Cap: $1.22 billion With roots dating back to 1896 and a global manufacturing footprint, CTS (NYSE:CTS) designs and manufactures sensors, connectivity components, and actuators for aerospace, defense, industrial, medical, and transportation markets. Why Do We Think Twice About CTS? Annual sales declines of 5.7% for the past two years show its products and services struggled to connect with the market during this cycle Revenue base of $520.9 million puts it at a disadvantage compared to larger competitors exhibiting economies of scale Earnings per share have dipped by 4.5% annually over the past two years, which is concerning because stock prices follow EPS over the long term CTS is trading at $41.55 per share, or 17.3x forward P/E. Check out our free in-depth research report to learn more about why CTS doesn't pass our bar. Stocks We Like More When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that's already erased most losses. Don't let fear keep you from great opportunities and take a look at Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
Android Authority
11 minutes ago
- Android Authority
Pixel 10 vs Pixel 8: Here's why I'm not upgrading
The Pixel 10 series, save for the base model, is largely an incremental upgrade, with Google draping the familiar design in new colors. If you are coming from a Pixel 9 series, there's little conviction to upgrade to the newer models, unless you absolutely cannot live without the new Pixelsnap accessories or the slightly improved Tensor G5. But what if you have an older Pixel 8 series phone? Then, the Pixel 10's newer design can be alluring, while the new telephoto on the vanilla Pixel 10 could compel you even more. But will it be worth it? And more importantly, will it truly feel like an upgrade beyond what Google is marketing it to be? To answer these questions, I'm weighing whether you should be upgrading to the Pixel 10, Pixel 10 Pro, or Pixel 10 Pro XL from a Pixel 8 or a Pixel 8 Pro. As a Pixel 8 user, are you upgrading to Pixel 10? If yes, which Pixel 10 feature compels you? 0 votes No, I'm not upgrading NaN % Yes! Better design, more colors NaN % Yes, I want Pixelsnap for wireless charging NaN % Yes! I want three cameras NaN % Yes, Magic Cue is exciting NaN % Yes, new Tensor G5 chip is appealing NaN % Keep in mind that we haven't fully reviewed the Pixel 10 phones yet. My opinions below are a blend of our hands-on experience with the devices, as well as their specs and features. A sleeker design doesn't mean much Rita El Khoury / Android Authority Pixel 10 One of the reasons consumers will be tempted to upgrade to a Pixel 10 is the more appealing design. Google updated to the newer design with the Pixel 9 series, with a flat metal frame and a flat glass back. It continues with the Pixel 10, along with new colors for the non-Pro model, one of which has already garnered much interest from you, our readers. In contrast, the Pixel 8's diffused and tempered colors could feel dull, while the curvier body might not live up to standards, especially since flagships such as the Galaxy S25 and the iPhone 16 have moved to boxier bodies. However, for me personally, a new design alone doesn't compel me to upgrade. I'm not as brave as my colleague, Mitja Rutnik, who refuses to put a case on his Pixel phones. Instead, I prefer draping all my phones in cases, which veils much of the design anyway, and am, therefore, immune to design changes. Tensor G5 is cool, but is it cool enough? Google Google packs the Pixel 10 series with a Tensor G5, which marks a fundamental shift in Google's chipsets. Unlike previous versions, which were built atop an Exynos base, Google is believed to have developed the G5 without any help from Samsung, although it still cherry-picks components from other vendors. This year, Google is relying on TSMC to manufacture the chips on its 3nm node, which is also used for the Snapdragon 8 Elite. This change has led to a 34% improvement in CPU performance and 60% improvement in neural processing for AI-related tasks. However, the most considerable improvement with Tensor G5 is better thermal efficiency. Traditionally, Pixel phones with Tensor chips haven't been short of pocket-sized furnaces. While this may be useful if you live in an alpine region, most of us would prefer our phones to run cooler. Google's best solution so far has been to shut down the phones in case they overheat, but I anticipate this to no longer be an issue with the new Tensor G5. Google's Tensor chips have not been great at gaming, and I will be cautious until I see actual benchmarks and performance tests. That said, I wouldn't jump ship without seeing reliable benchmark figures and real-life tests. At the same time, I am concerned about gaming since Tensor chips traditionally don't do well. While Google has partially confirmed our previous leaks about a new GPU, it has told us there's no ray-tracing yet. So until I witness the Tensor G5 tested and playing well with games, I may hold my enthusiasm to upgrade. Additionally, the base Pixel 10 also gets 12GB of RAM, which is an increment over the base Pixel 8's 8GB RAM. This upgrade opens up support for multimodal AI processing on-device with Google's Gemini Nano models, instead of limiting it to text-based functions, such as message summarization. If you rely on those Gemini features and plan to use them more over the coming few years, upgrading the RAM is crucial. However, if you feel you can wait for another year or two before on-device AI matures more, it might be worth the wait. Pixelsnap is exciting, but not game-changing C. Scott Brown / Android Authority Google is adding Qi2 wireless charging support to the Pixel 10, but the more compelling aspect is its added support for magnetic snapping. It's the first among Android manufacturers to bring MagSafe-style magnetic attachments and open support for an extensive catalog of chargers and accessories. That is another point to consider the Pixel 10 series phones, except, of course, if you concur with me on my need for cases. Pixel 10 phones come on par with iPhone, but it doesn't solve the biggest issue with wireless charging. Although I find the magnetic snapping satisfactory — and have surrounded myself with MagSafe accessories, such as chargers and a wallet — I have been content with cases that come built-in with magnetic rings. So with that in mind, Pixel's new Pixelsnap accessories lose their appeal for me. And while Google claims better, faster charging speeds, I am cautious that this translates to faster charging. Wireless charging is known to slow down with the heat generated in the process, which is why brands like OnePlus have instead focused on adding cooling fans to their fast wireless chargers. My skepticism currently prevents me from recommending an upgrade solely for the flashy new accessories. However, if you have been waiting for a MagSafe-like solution on your Pixel and abhor cases, then this might be your sign to upgrade. But for now, I will rest my horses and wait for real-life results. A Pixel 8 still has the latest Android features Rita El Khoury / Android Authority One of my biggest reasons to recommend against upgrading from a Pixel 8 to a Pixel 10 is Google's promised support for the former. The Pixel 8 series promises seven years of software support, which adds to its longevity. Even without these glorified promises, Google usually does not isolate new software to specific models. Starting this year, Google is no longer tying the Android 16 update to the new Pixel launch — and all eligible phones have already received the update. So, there's hardly any reason to buy a newer Pixel 10 for the software. The outlier here could be Pixel's upcoming Magic Cue functionality, which uses context from your screen to offer highly personalized suggestions. Since a lot of this is processed on-device using Gemini Nano, older hardware may not satisfy its requirements, and Google could skip support for older devices altogether — as it did with the Pixel Screenshots. Although standalone features like Magic Cue sound promising, I find no incentive to upgrade and pay for a new phone for one new feature (or two, if you factor in Pixel Screenshots) — not without seeing it in action. The only valid reason to upgrade Rita El Khoury / Android Authority 100x processed With the Pixel 10, Google is making one radical (but welcome) change. Now all phones, including the base model, come with three cameras, and the base Pixel 10 gets a new telephoto lens with 5x optical zoom, which was previously limited to the Pro phones. Now, while the other additions I spoke of above are intriguing, nothing compels me more than the new camera added here. Among others, this is one feature that will have concrete results and is bound to improve long-range or portrait photography, especially since the base Pixel 8 came with only two cameras. Google furnishes Pixel 10 and Pixel 10 Pro with different telephoto cameras, but having one is better than having none. Notably, the Pixel 10 is limited to 20x digital magnification with Pro Res Zoom despite a similar optical zoom level as the Pixel 10 Pro. Meanwhile, the Pro, owing to its larger sensor and bigger megapixel count, can zoom up to 100x digitally. Despite this shortcoming, the presence of a dedicated zoom lens opens up new opportunities for enthusiasts without asking them to shell out more for the Pro. Should you upgrade from Pixel 8 to Pixel 10? Rita El Khoury / Android Authority The question that remains is whether the jump from the Pixel 8 is massive enough to switch to the Pixel 10? While I would stress sticking to the Pixel 8, certain conditions might favor the Pixel 10. For instance, upgrading to a Pixel 10 from the base Pixel 8 makes sense to me for the extra camera or more RAM. However, I'm much less convinced about the new Pixelsnap accessories and can happily pass on upgrading just for the new design. That said, I might revisit this thought later if the new Tensor G5 chip or the new Magic Cue feature show promising real-life results. But, until then, there is a slim chance that I would suggest any Pixel 8 user to upgrade to Pixel 10. Of course, one more reason to upgrade is to enter the landscape of foldables with the new Pixel 10 Pro Fold, and in that case, there's no stopping. Follow
