Top Consumer Stocks to Sell in August: Newegg Commerce and Wolverine World Wide

Newegg Commerce Inc (NEGG) and Wolverine World Wide Inc (WWW) are two consumer discretionary stocks that could be flashing warning signs for investors who value momentum. Their RSI values are 80.7 and 81, respectively, indicating they may be overbought. NEGG's stock has jumped 154% in the past month and has a 52-week high of $98.45, while WWW's stock has gained 48% over the past month and has a 52-week high of $28.81. Both stocks have strong momentum scores but low value scores.

Two consumer discretionary stocks, Newegg Commerce Inc (NEGG) and Wolverine World Wide Inc (WWW), are flashing warning signs for investors who value momentum. Both companies have shown significant price appreciation, but their Relative Strength Index (RSI) values indicate potential overbought conditions.

Newegg Commerce Inc, which operates an online retailer for electronics and consumer goods, saw its stock jump around 154% over the past month, reaching a 52-week high of $98.45. The company's RSI value stands at 80.7, suggesting that the stock may be overbought [1]. Despite the strong momentum, Newegg's stock has a relatively low value score of 49.98, indicating that it may not be undervalued [1].

Wolverine World Wide Inc, a footwear and apparel company, reported better-than-expected second-quarter financial results and issued third-quarter EPS guidance above estimates. The company's stock gained around 48% over the past month and has a 52-week high of $28.81. However, its RSI value is 81, also indicating potential overbought conditions [1]. While WWW has a strong momentum score of 99.49, its value score is relatively low at 49.98, similar to Newegg [1].

Both companies have shown impressive growth and strong momentum, but their high RSI values suggest that investors may want to exercise caution. The RSI is a momentum indicator that compares a stock’s strength on days when prices go up to its strength on days when prices go down. An asset is typically considered overbought when the RSI is above 70 [1].

Investors should monitor these stocks closely and consider the risks associated with overbought conditions. While strong momentum can lead to significant price appreciation, it can also result in a sharp correction if the stock becomes overvalued. It is essential for investors to conduct thorough research and consider their risk tolerance before making investment decisions.

References:
[1] https://www.benzinga.com/trading-ideas/short-ideas/25/08/47122045/top-2-consumer-stocks-you-may-want-to-dump-in-august