7 Short-Term Stocks to Handle With Caution

Things are changing quickly in the stock market. For investors, that means it is important to be careful with short-term stocks.

News of effective vaccines against Covid-19 from pharmaceutical companies Moderna (NASDAQ:MRNA) and Pfizer (NYSE:PFE) have prompted an abrupt shift…

In just a few days, money has flown away from stay-at-home stocks and leading technology names. Now, investors are returning to cyclical stocks and equities that will rise once a vaccine is widely available and the global economy fully reopens. This shift is benefitting stocks of banks, airlines, resorts, cruise lines and restaurants while it is hurting stocks that have been stars since the pandemic shut things down in March. Companies such as Zoom Video (NASDAQ:ZM) and Shopify (NYSE:SHOP) have fallen sharply.

With this in mind, we will look at seven short-term stocks that investors should view carefully as we close out 2020 and head into 2021.

  • Peloton (NASDAQ:PTON)
  • JD.com (NASDAQ:JD)
  • Fastly (NYSE:FSLY)
  • DocuSign (NASDAQ:DOCU)
  • Netflix (NASDAQ:NFLX)
  • Domino’s Pizza (NYSE:DPZ)
  • Las Vegas Sands (NYSE:LVS)

Short-Term Stocks: Peloton (PTON)

With gyms and fitness clubs closed because of Covid-19, shares of exercise bike and treadmill manufacturer Peloton took off. In fact, they rose an astounding 609% from $20 a share in March to $140 a share in mid-October. It made sense given that sales of Peloton’s exercise equipment skyrocketed as people set up home gyms and switched to at-home fitness. The company’s recent fiscal fourth-quarter sales surged 172% from the previous year.

My how things have changed. Since peaking on Oct. 15, PTON stock has fallen to $110 a share. The stock fell more than 20% on the day Pfizer announced its Covid-19 vaccine is more than 90% effective. And it is not just the reopening of gyms that has investors selling Peloton stock. The company raised eyebrows with its fourth-quarter results when it flagged that its supply chain is under intense pressure and that it will struggle to fill orders going forward.

Investors may want to hold Peloton stock through the busy holiday sales period, but should look to sell in early 2021 as mass vaccination against Covid-19 begins.

JD.com (JD)

JD.com is one of the riskier Chinese e-commerce companies. The online retailer has had a rocky year. What do I mean? Well, JD stock has more than…

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