3 stocks with more reasons to sell than to buy right now

With inflation far from the Fed's control, analysts predict the possibility that the central bank will continue its aggressive interest rate hikes. Amid growing recession fears and lingering market uncertainty, we think it's best to avoid fundamentally weak stocks Twitter (TWTR), GameStop (GME) and Opendoor Technologies (OPEN) now. Keep reading….

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August CPI's 8.3% year-over-year increase strengthens case for increase aggressive interest rate hikes by the Fed. Vanguard expects the benchmark lending rate to end this year at 3.75% and 2023 at 4.25%. Additionally, the investment management firm has estimated a 65% chance of a recession in 2023.

Steve Hanke, a professor of applied economics at Johns Hopkins University, said, "We're going to have a huge recession in 2023." Amid growing recession fears, a survey last month showed that more than half of all U.S. companies are planning layoffs as they prepare for an economic downturn.

Against this backdrop, we think it's best to now avoid fundamentally weak stocks of Twitter, Inc. (TWTR), GameStop Corp. (GME) and Opendoor Technologies Inc. (OPEN).

Twitter, Inc. (TWTR)

TWTR functions as a platform for public expression and real-time conversation. The company's core product is Twitter, a platform that enables users to consume, create, distribute and discover content.

On September 13, 2022, TWTR shareholders approved the previously announced merger agreement for the acquisition of TWTR by affiliates of Elon Musk. However, Musk tried to end the deal. The social media company sued Musk for allegedly violating the agreement, and a trial is expected to begin in mid-October.

TWTR's revenue was $1.18 billion for the second quarter ended June 30, 2022, down slightly year-over-year. Its non-GAAP net loss was $57.73 million, compared to a profit of $174.52 million for the prior period.

In addition, its non-GAAP loss per share was $0.08, compared to EPS of $0.20 in the prior year. Additionally, its adjusted EBITDA was $111.70 million, down 67.5% year-over-year.

TWTR EPS is expected to decline 27.3% year-over-year to $0.24 for the quarter ending December 2022. It has missed EPS estimates in three of the last four quarters. Over the past month, the stock has lost 5.3% to close the last trading session at $41.66.

TWTR's POWR ratings reflect its weak outlook. It has an overall rating of D, indicating a sale. POWR ratings rate stocks on 118 different factors, each with its own weighting.

Furthermore, the stock has a D rating for Momentum, Stability and Sentiment. Click here to access additional POWR ratings for TWTR (Growth, Value and Quality). TWTR is ranked #45 out of 65 F-rated internet stocks.

GameStop Corp. (GME)

Specialty retailer GME offers games and entertainment products through its e-commerce properties and various stores in the United States, Canada, Australia and Europe.

GME's net sales decreased 4% year-on-year to $1.14 billion for the second quarter ended July 30, 2022. Its gross profit was $282.20 million. dollars, down 12.1% year-on-year, while its net loss came in at $108.70 million, up 76.5% year-on-year.

GME's EPS is expected to decline 20.2% year-over-year to $1.37 in 2023. Its EPS is expected to remain negative in 2024. Additionally, it missed EPS estimates at during three of the last four quarters. Over the past month, the stock has lost 20.6% to close the last trading session at $28.96.

GME has an overall F...