The right stocks can make you rich and change your life.
The wrong stocks, though… They can do a whole lot more than just “underperform.” If only! They can eviscerate your wealth, bleeding out your hard-won profits.
They’re pure portfolio poison.
Surprisingly, not many investors want to talk about this. You certainly don’t hear about the danger in the mainstream media – until it’s too late.
That’s not to suggest they’re obscure companies – some of the “toxic stocks” I’m going to name for you are in fact regularly in the headlines for other reasons, often in glowing terms.
I’m going to run down the list and give you the chance to learn the names of three companies I think everyone should own instead.
But first, if you own any or all of these “toxic stocks,” sell them today…
Dollar Tree (DLTR)
Dollar Tree (NASDAQ: DLTR) has had a tough year, and the stock’s recent 22% drop following a cut in its full-year outlook has raised even more concerns. The retailer blamed weaker sales for its downgraded guidance, and analysts have taken note. In 2024, Dollar Tree is down nearly 53%, making it a prime candidate for tax-loss selling.
With half of the analysts covering Dollar Tree rating it as a “hold,” there’s not much optimism for a near-term turnaround. BMO Capital Markets recently downgraded the stock, citing the company’s uncertain outlook and dropping its price target to $68, offering only about 7% upside. Given these factors, Dollar Tree could face continued selling pressure as the year winds down. If you’re holding DLTR, now might be the time to consider cutting your losses and moving on to stronger opportunities.
ZoomInfo Technologies (ZI)
ZoomInfo Technologies (NASDAQ: ZI) is another stock that has struggled in 2024, with shares down 46% year-to-date. Despite the company’s long-term potential, analysts are cautious about its near-term outlook. More than half of those covering the stock have rated it as a “hold,” reflecting concerns about continued revenue headwinds.
Mizuho Securities recently flagged issues around downsells and renewals that could keep weighing on the stock in the short term. While there’s hope for a rebound in the longer term, ZoomInfo’s current challenges make it a potential candidate for tax-loss selling. Investors may want to consider exiting the stock before further declines.
Rivian Automotive (RIVN)
Rivian Automotive (NASDAQ: RIVN) has been a high-profile player in the electric vehicle space, but it’s also been one of 2024’s biggest underperformers. With shares down significantly this year, Rivian could see additional selling pressure as investors look to lock in tax losses.
While Rivian’s future in the EV market remains promising, the company is still in the early stages of growth and faces significant competition. The stock’s performance this year makes it a candidate for trimming before the year ends, especially if you’ve held it through its rough 2024 run.
