The Fed’s aggressive interest rate hikes to control the stubborn inflation have dampened investor sentiment. With investors trying to protect their capital by selling shares, the S&P 500 has…
lost more than 20% year-to-date, while the tech-heavy Nasdaq has fallen more than 30% over this period.
Additionally, September’s hotter-than-expected inflation and employment data have strengthened the case for the Fed to announce another aggressive interest rate hike in its November meeting. The central bank’s strong determination to keep hiking interest rates until inflation is under control has raised fears of a recession.
According to the latest Bloomberg Economics model projections, the likelihood of the United States entering a recession in the next 12 months is 100%. Amid this grim economic outlook, fundamentally weak stocks Marvell Technology, Inc. (MRVL), Faraday Future Intelligent Electric Inc. (FFIE), and Oblong, Inc. (OBLG) could be best avoided now.
Marvell Technology, Inc. (MRVL)
MRVL is engaged in designing, developing, and selling integrated circuits and other infrastructure semiconductor solutions. The company’s offerings cater to five markets — data center, carrier infrastructure, enterprise networking, consumer, and automotive/industrial.
MRVL’s operating expenses increased 17% year-over-year to $746.90 million for the fiscal second quarter ended July 30, 2022. The company’s total liabilities stood at $6.63 billion, compared to $6.41 billion for the fiscal year ended January 29, 2022. Its current liabilities increased 55.2% to $2.15 billion, compared to $1.38 billion for the fiscal year ended January 29, 2022.
MRVL’s forward P/Sales of 5.48x is 122.2% higher than the industry average of 2.47x. In terms of forward EV/Sales, the stock is trading at 6.16x, 141.1% higher than the industry average of 2.55x.
The stock has lost 54.8% year-to-date and 41.1% over the past year to close the last trading session at $39.54.
MRVL’s POWR Ratings reflect weak prospects. The stock has an overall D rating, which equates to a Sell in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
It also has a D grade for Value, Stability, and Quality. In the Semiconductor & Wireless Chip industry, MRVL is ranked #83 of 93 stocks.
To see the other ratings of MRVL for Growth, Momentum, and Sentiment, click here.
Faraday Future Intelligent Electric Inc. (FFIE)
FFIE designs, develops, manufactures, sells, and distributes electric vehicles and related products in the United States and internationally.
For the second quarter ended June 30, 2022, FFIE’s operating loss widened 389.3% year-over-year to $137 million, while its net loss came in at $142 million. The company’s total assets stood at $588 million as of June 30, 2022, compared to $706.06 million as of March 31, 2022.
Analysts expect FFIE’s loss per share for the quarter ending December 2022 to widen 288.9% year-over-year to $0.35. Also…
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