Top 5 Consumer Stocks That May Implode

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.

WW International, Inc. WW

• WW International posted worse-than-expected Q4 earnings and soft Q1 guidance. The company also announced it will acquire Weekend Health, Inc. for a net purchase price of $106 million. “We ended 2022 with 3.5 million subscribers, ahead of our guidance, improving our position as we started the year,” said Sima Sistani, the Company’s CEO. The company’s stock has a 52-week high of $11.03 .
• RSI Value: 84.85
• WW Price Action: Shares of WW International gained 79.1% to close at $6.93 on Tuesday.

ThredUp Inc. TDUP

• ThredUp reported better-than-expected Q4 sales and issued strong Q1 guidance. “We are proud to deliver strong Q4 results in what continues to be a highly competitive environment,” said thredUP CEO and co-founder James Reinhart. The company’s stock has a 52-week high of $8.99.
• RSI Value: 78.19
• TDUP Price Action: Shares of ThredUp gained 51.2% to close at $2.45 on Tuesday.

NeoGames S.A. NGMS

• NeoGames reported better-than-expected Q4 adjusted EPS results. Moti Malul, Chief Executive Officer of NeoGames, said, “We are proud of the tremendous progress we made during 2022, further solidifying our iLottery leadership position in a continually expanding market.” The company has a 52-week high of $18.96.
• RSI Value: 73.32
• NGMS Price Action: Shares of NeoGames gained 12.7% to close at $16.68 on Tuesday.

DICK'S Sporting Goods, Inc. DKS

• Dick's Sporting Goods reported better-than-expected Q4 results and issued strong FY23 guidance. "Following two consecutive record years, we are very pleased with our 2022 performance, which was the largest sales year in our company's history," Ed Stack, Executive Chairman said. The company’s 52-week high is $146.89.
• RSI Value: 86.18
• DKS Price Action: Shares of DICK'S Sporting Goods jumped 11.1% to close at $146.79 on Tuesday.

The Beachbody Company, Inc. BODY

• The Beachbody Company reiterated its Q4 outlook. The company has a 52-week high of $2.33.
• RSI Value: 72.59
• BODY Price Action: Shares of Beachbody gained 9.4% to settle at $0.8311 on Tuesday.

Read More: Check Out 3 High-Yielding Dividend Stocks In Defensive Sector From Wall Street's Most Accurate Analysts