Top 3 Health Care Stocks That May Crash In May

As of May 24, 2024, three stocks in the health care sector could be flashing a real warning to investors who value momentum as a key criteria in their trading decisions.

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, according to Benzinga Pro.

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

TransMedics Group, Inc. TMDX

• On April 30, TransMedics posted upbeat quarterly results and raised its 2024 guidance. “We are pleased with our first quarter results as we simultaneously drove continued revenue growth, expanded our infrastructure, and achieved profitability,” said Waleed Hassanein, MD, President and Chief Executive Officer. The company's stock gained around 55% over the past month and has a 52-week high of $142.30.
• RSI Value: 78.24                              
• TMDX Price Action: Shares of TransMedics rose 0.4% to close at $137.53 on Thursday.

CareDx, Inc CDNA

• On May 9, CareDX reported better-than-expected first-quarter financial results and issued FY24 revenue guidance above estimates. “We set a new baseline in our Testing Services business in the second half of 2023 and are back to delivering sequential growth. I am pleased with the team’s strong performance across all businesses this quarter,” said John W. Hanna, CareDx President and CEO. The company's stock gained around 98% over the past month and has a 52-week high of $16.54.
• RSI Value: 76.48
• CDNA Price Action: Shares of CareDx rose 1.7% to close at $15.83 on Thursday.

Heron Therapeutics, Inc. HRTX

• On May 7, Heron Therapeutics reported better-than-expected first-quarter financial results and reaffirmed its FY24 revenue guidance. “We are extremely pleased with our ability to improve the financial efficiency of the business by growing revenues, improving margins, and reducing expenses. We made tremendous progress this quarter by promptly training CrossLink sales representatives and integrating them into our commercial execution, while also training our own commercial team on the newly expanded label for ZYNRELEF,” said Craig Collard, Chief Executive Officer of Heron. The company's stock gained around 31% over the past month and has a 52-week high of $3.59.
• RSI Value: 71.77
• HRTX Price Action: Shares of Heron Therapeutics closed at $3.47 on Thursday.

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