Stocks to sell

With Thanksgiving and other winter holidays fast approaching, it’s a good practice to stop and consider what we’re grateful for. When it comes to the professional realm, I’m appreciative for the ability to get paid for crafting (hopefully) compelling stories. Through this journey, I’ve reached out to millions and even make regular TV appearances. But now, I’ve got to talk about stocks to sell.

An unpleasant topic in the best of times, broaching the subject during one of the most remarkable bull markets is liable to get you a healthy dose of mockery. As well, anybody who ventures into the dark side can expect a few nasty grams. I get it. When you talk about stocks to sell, it promotes the image that you’re deliberately conducting an orchestra of pain.

Who’d want that? Well, as I usually like to explain to folks who may not be holistically educated about market dynamics, bidding up one side exclusively is never a sustainable circumstance.

Nevertheless, it may be part of the American culture not to give up or give in. Again, I can appreciate how optics play an important role in investor psychology. Therefore, I looked at stocks to sell covering the entire spectrum of market offerings that you might not feel bad about exiting. These are businesses that have earned a tsk-tsk for various reasons.

Maybe they dumped toxic chemicals into the water or they’re tied to industries that are increasingly at odds with social directives. Maybe they just don’t treat their workers that well. Or in the worst cases, they’re just plain gross. Here are seven stocks to sell that make it easy to say goodbye.

  • Zillow (NASDAQ:Z, NASDAQ:ZG)
  • Sinopec Shanghai Petrochemical (NYSE:SHI)
  • Nornickel (OTCMKTS:NILSY)
  • Fox Corp (NASDAQ:FOXA)
  • Geo Group (NYSE:GEO)
  • Vapor Hub International (OTCMKTS:VHUB)
  • RCI Hospitality (NASDAQ:RICK)

Before we dive in, it’s important to take this list of stocks to sell with a grain of salt. I’m not necessarily saying you should dump them nor should you short them. Instead, these are companies that, based on present social mores, will not find much hesitation if their stakeholders decide to move on without them.

Stocks to Sell: Zillow (Z)

Source: II.studio / Shutterstock.com

If there’s one company that will likely not garner any sympathy from anyone, it’s Zillow. Heck, while I know that Z shares have dropped about 35% over the trailing month, I still think there’s room for more downside if you’re an aggressive bear wanting to buy put options.

So yes, not only do I think Z is one of the stocks to sell, this might be an equity unit to short (so long as you understand the risks of having a short position, of course). Again, it’s a terrible investment at this juncture and I think it will drop much further. Indeed, you’ll find few sympathizers if Zillow went to zero.

It’s a shame too because over the years, I’ve spoken well about the company. However, it’s decision to be a home-flipper backfired spectacularly, with Zillow looking to “offload around $2.8 billion worth of houses onto investors.”

What makes this story so cathartic is that technically, gouging people out of the American Dream isn’t a crime, it’s capitalism. But then, that same company can’t cry foul when capitalism cuts with its double-edged sword. Yup, Z is one of the sweetest stocks to sell.

Sinopec Shanghai Petrochemical (SHI)

Source: Shutterstock

While it’s important to have nuanced discussions regarding the novel coronavirus pandemic and the various social ills that it catalyzed, facts are facts. The sad reality is that had the Chinese government been more upfront about the SARS-CoV-2 outbreak rather than to save face with the international community, the situation may have been better mitigated, not just for the U.S. but for the rest of the world.

It’s no surprise, then, that unfavorable views of China skyrocketed following the Covid-19 disaster. Further, China’s poor handling of the crisis sparked other questions about hot-button issues. For instance, the Financial Times wrote in November 2020 that the country’s ESG (environmental, social, governance) rating is the worst of any major market.

Then you factor in companies like Sinopec Shanghai Petrochemical. Right now, with gasoline prices soaring to ridiculous levels at home, nobody is in a mood to be generous to major oil companies. And if we’re not going to extend much courtesy to our own energy firms, you can bet that SHI isn’t going to receive much love, making it one of the easy stocks to sell (should you want to).

Stocks to Sell: Nornickel (NILSY)

Source: madamF / Shutterstock.com

I have conflicted feelings about Nornickel, also known as Norilsk Nickel. One of the most powerful Russian mining firms, it’s the world’s largest producer of palladium. And I’ve got a thing for palladium, having encouraged investors to consider both the metal and the companies that mine it.

In the spirit of full disclosure, I think it’s smart to have some exposure to precious metals. Further, I practice what I preach, which makes me less than a happy camper. I’m going to get heat for associating Nornickel with any list of stocks to sell.

However, when it comes to ESG-based principles, Russia has plenty of catching up to do. Granted, it’s not nearly as bad as China but the Russian economy is dependent on “dirty” industries. That means no matter what, the financial infrastructure in the country is tied to ESG-unfriendly companies.

Further, Nornickel is a terrible actor on multiple environmental violations, from dumping waste into rivers and even polluting the Arctic. So in this regard, if you wanted to put NILSY in a list of stocks to sell, you shouldn’t feel too broken up about it.

Fox Corp (FOXA)

Source: Leonard Zhukovsky / Shutterstock.com

I don’t want to dive too deeply into American politics considering how the nation still feels bitterly about the events of the 2020 election and its aftermath. Nevertheless, Fox Corp, which owns Fox News, draws plenty of criticism for disseminating controversial viewpoints to the public.

As with any major news agency, Fox News features two main departments: their journalism section and their editorial section. Where at least some of the confusion and anger that lies in our public discourse is confusion between the two. For instance, Fox’s Tucker Carlson and CNN’s Don Lemon are primarily editorialists. On the other hand, Fox’s Bret Baier and CNN’s Wolf Blitzer fall into the journalism category.

Now, what makes FOXA one of the easy stocks to sell for some folks is that the opinions coming out of Fox’s editorial staff are not aligned with contemporary ideologies. For instance, civil rights organizations have criticized Tucker Carlson for promoting the replacement theory, a xenophobic idea that nefarious agents are flooding western nations with immigrants to change demographic compositions.

To be fair, Fox denies the implications of such opinions. However, I think it’s also fair to say this company is playing with ESG fire.

Stocks to Sell: Geo Group (GEO)

Source: rawf8/Shutterstock

If you read the text of Geo Group’s website without any context, you might be led to believe it’s an ESG play through and through. Certainly, the company has the buzzwords down pat. Evidence-based rehabilitation programs. In-custody and post-release care. Corporate social responsibility. Commitment to human rights.

Pretty soon, Geo Group might be talking about ethical ethics. Honestly, it’s not that I necessarily have an aversion to Geo. And I’m sure many within the company and the underlying industry mean well. But no matter how many ESG buzzwords a corporation publishes, when it comes to Geo, only the one truth sticks out: for-profit private prisons.

Now, I would be a hypocrite to say that you shouldn’t invest in GEO. I’ve included the equity unit in discussions about vice-related investments in years past. However, that doesn’t take away from the fact that profiteering off other people’s mistakes presents a moral roadblock.

However, we should be fair. Private prisons represent a small component of the criminal justice system. Further, focusing on relatively minor issue may take away from broader criminal justice reform initiatives. Nevertheless, you won’t find too many folks hating you if you relegated GEO to stocks to sell.

Vapor Hub International (VHUB)

Source: Shutterstock

A few years back, vaporizers or e-cigarettes were all the rage, with booming small business growth. Fundamentally, the sector is still very popular, especially with adult smokers looking for a cleaner platform to ween off the addiction to nicotine. Unfortunately, vaporizers have courted controversy because of accusations that they entice children and teens to vape. And that puts Vapor Hub International in the crosshairs.

Over the last several months, the Food and Drug Administration have been cracking down on e-cigarette products. While vape proponents argue that such draconian measures only serve the interest of big tobacco — and for full disclosure, I own some shares of a big tobacco firm — the anti-vaping campaign is optically a powerful one.

Not only that, vape enthusiasts are not going to get any sympathy from the medical community. For example, Johns Hopkins Medicine stated bluntly that “It’s not safe to use vape pens or e-cigarette devices around kids. The vapor from e-cigarettes has chemicals in it that can be harmful to kids.”

Therefore, if you decide to throw VHUB in your list of stocks to sell, you will find less opposition than you might have if we were still back in 2016.

Stocks to Sell: RCI Hospitality (RICK)

Source: Shutterstock

Many years ago, one of the higher ups at RCI Hospitality stated that he liked my work, having featured RICK as one of the vice trades that could make traders money. Sure enough, shares in the long run have been a top performer.

So it bugs me to talk about RCI in this particular context. However, I cannot let my personal feelings about a company cause me to ignore certain realities. And the reality for RICK stock is that it’s an investment tied to the fabric-free industry, an industry which many argue is degrading for women.

Usually, I link to reputable resources to bolster my argument. However, I’m going to deliberately refrain in this case because I want to avoid any mentioning of intimate work. Plus, what I’m saying is self-evident.

Of course, there are two sides to this argument, primarily that some people consciously choose fabric-free careers. Also, denigrating certain industries based on traditional moral or religious reasons can cause its own problems under today’s inclusive ethos. Still, if you decided to sell RICK, arguably most will applaud your decision.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.

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