Top 5 Consumer Stocks That Could Sink Your Portfolio In Q3

The most overbought stocks in the consumer discretionary 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.

Kohl's Corporation KSS

• Kohl's reported better-than-expected first-quarter results and reaffirmed FY23 outlook. The company’s stock has a 52-week high of $36.60. .
• RSI Value: 75.24
• KSS Price Action: Shares of Kohl's gained 0.8% to close at $28.45 on Monday.

Ethan Allen Interiors Inc. ETD

• Ethan Allen Interiors posted better-than-expected third-quarter earnings. Farooq Kathwari, Ethan Allen’s Chairman, President and CEO commented, “We are pleased with our third quarter operating performance. We delivered consolidated net sales of $186.3 million, gross margin of 59.9%, operating margin of 15.5% and net income of $22.4 million.” The company’s stock has a 52-week high of $31.80.
• RSI Value: 73.25
• ETD Price Action: Shares of Ethan Allen Interiors gained 1.2% to close at $31.47 on Monday.

M.D.C. Holdings, Inc. MDC

• M.D.C. Holdings posted upbeat second-quarter results. "MDC delivered another quarter of strong results in the second quarter of 2023, generating net income of $93 million, or $1.24 per diluted share, on home sale revenues of $1.1 billion," said MDC's Executive Chairman, Larry Mizel. The company has a 52-week high of $51.68.
• RSI Value: 70.55
• MDC Price Action: Shares of M.D.C. Holdings gained 0.4% to close at $51.28 on Monday.

Bassett Furniture Industries, Incorporated BSET

• Bassett Furniture posted downbeat quarterly sales. The company’s 52-week high is $22.83.
• RSI Value: 75.93
• BSET Price Action: Shares of Bassett Furniture Industries rose 3.5% to close at $17.60 on Monday.

Haverty Furniture Companies, Inc. HVT

• Haverty Furniture posted downbeat quarterly results. Clarence H. Smith, chairman and CEO, said, “Our team delivered a strong quarter against difficult headwinds of shifts in consumer spending and persistent inflationary pressures. Sales reflect the reduction in traffic and written business that we have reported in recent quarters as our business transitioned from the pandemic's explosive pace to a more measured one.” The company has a 52-week high of $38.85.
• RSI Value: 84.99
• HVT Price Action: Shares of Haverty Furniture gained 1.4% to settle at $35.60 on Monday.

Read More: Insiders Buying Texas Capital Bancshares And 3 Other Stocks