Benzinga - The most overbought stocks in the consumer discretionary sector presents an opportunity to go short on these overvalued companies.
The RSI is a momentum indicator, which compares a stock's strength on days when prices go up to its strength on days when prices go down. When compared to a stock's price action, it can give traders a better sense of how a stock may perform in the short term. An asset is typically considered overbought when the RSI is above 70.
Here’s the latest list of major overbought players in this sector.
LL Flooring Holdings, Inc. (NYSE: LL)
- LL Flooring confirmed the receipt of $5.76 per share unsolicited, non-binding proposal from Cabinets To Go, a subsidiary of F9 Brands. The company’s stock has a 52-week high of $12.52 .
- RSI Value: 70.18
- LL Price Action: Shares of LL Flooring rose 8.7% to close at $4.50 on Wednesday.
- Tile Shop posted downbeat earnings for its first quarter. “Our sales during the first quarter were flat with last year,” stated Cabell Lolmaugh, CEO. “Ocean freight costs have come down which contributed to a slowing rate of margin decline.” The company’s stock has a 52-week high of $5.97.
- RSI Value: 74.09
- TTSH Price Action: Shares of Tile Shop rose 4.8% to close at $5.26 on Wednesday.
- The company said homebuilding revenues increased 16% year-over-year to $767 million in the first quarter. Patrick Zalupski, Dream Finders Homes Chairman and CEO, said, "Coming off a record fourth quarter in 2022, DFH maintained positive momentum in the first quarter of 2023, delivering revenue growth of 16% along with pre-tax income of $69 million and earnings per basic share of $0.49, which increased 10% and 12%, respectively, compared to the year-ago quarter. These are all first quarter Company records." The company has a 52-week high of $18.63.
- RSI Value: 72.16
- DFH Price Action: Shares of Dream Finders Homes rose 3.3% to close at $18.54 on Wednesday.
- The EV maker plans to give an early glimpse of its revamped Model 3 sedan as part of Elon Musk's first visit to the company's Shanghai factory in years, reported Bloomberg citing people familiar with the matter. The company’s 52-week high is $314.67.
- RSI Value: 72.97
- TSLA Price Action: Shares of Tesla rose 1.4% to close at $203.93 on Wednesday.
- NeoGames agreed to be acquired by Australia's Aristocrat Leisure Limited, a gaming and technology company. “After careful consideration, the Board determined that Aristocrat’s proposal provides shareholders with compelling value, further validating the strength of the business that NeoGames has built,” said CEO Moti Malul. The company has a 52-week high of $27.77.
- RSI Value: 82.61
- NGMS Price Action: Shares of NeoGames gained 0.1% to settle at $27.27 on Wednesday.
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