Buy Or Avoid: Have These Stocks Bottomed?
As the markets continue to hit new 52 week highs, certain former winners are sitting at their lows. In a market this strong, how did these stocks fall out of favor? Are they good buys?
The first stock is Cisco Systems, Inc. (NASDAQ:CSCO). This stock was a former darling until recent earnings misses. Company management has said they are restructuring and hope to turn things around. The stock is down from a 52 week high of $27.74 to its current price of $17.40. With the current valuation, Cisco is looking attractive. The stock seems to have found significant support in the $16.50 to $17.00 level and has held multiple times. With the power of the name and an insane amount of cash, the bad news may be priced in and the turn around starting.
Semiconductor Equipment & Materials maker Cree, Inc. (NASDAQ:CREE) is another former darling of the markets. This stock soared all the way to $81.69 before falling over 50%. It currently trades at $40.35. The stock recently hit the $38.50 level which is major support on the daily and likely a short term bottom. Ultimately, this stock seems to be in purgatory for the time being and should only be played as a swing trade off the $38.50 level. The swing trade bounce can take the stock to $47.00 before it meets major resistance and will likely pull back.