Top 2 Real Estate Stocks That Are Ticking Portfolio Bombs

The most overbought stocks in the real estate sector presents an opportunity to go short on these overvalued companies.

The RSI is a momentum indicator, which compares a stock's strength on days when prices go up to its strength on days when prices go down. When compared to a stock's price action, it can give traders a better sense of how a stock may perform in the short term. An asset is typically considered overbought when the RSI is above 70.

Here’s the latest list of major overbought players in this sector.

Leju Holdings Limited LEJU

• Leju Holdings reported H2 Non-gaap loss per ADS of $(2.33). "In the second half of 2022, China's real estate industry did not show significant improvement, while real estate developers continued to experience liquidity pressure and overall market sales continued to decline, all of which had negatively impacted Leju's online advertising and e-commerce businesses," said Mr. Geoffrey He, Leju's Chief Executive Officer. The company’s stock has a 52-week high of $9.84 .
• RSI Value: 95.31
• LEJU Price Action: Shares of Leju Holdings rose 96.7% to close at $3.56 on Monday.

Forestar Group Inc. FOR

• Forestar Group reported better-than-expected Q2 EPS and sales results. Daniel Bartok, CEO, said, "The Forestar team delivered a solid second quarter demonstrated by generating $301.5 million of consolidated revenues while maintaining double-digit pre-tax profit margins and return on equity. Despite the transitioning housing market, inflationary environment and tough year-over-year comparisons, we have maintained our strong balance sheet, remained flexible and adapted quickly to changing builder demand." The company’s stock has a 52-week high of $19.95.
• RSI Value: 76.83
• FOR Price Action: Shares of Forestar Group rose 1.8% to close at $19.69 on Monday.