In this article, we will take a look at the 15 worst performing stocks in S&P 500. To skip our analysis of the recent trends and market activity, you can go directly to see the 5 Worst Performing Stocks in S&P 500.
The S&P 500 Index was up nearly 6.9% year-to-date, as of February 26, and continues its rally that started in late October. The rally was supported by investor optimism about potential interest rate cuts in 2024 as the Federal Reserve’s battle to control inflation seems to be bearing fruit. Recently, Goldman Sachs lifted its S&P 500 index year-end target to 5200 which represents further 4% growth for the Index based on current levels. Goldman Sachs has raised its forecast from 4700 which was announced in its 2024 Outlook report in December.
Goldman Sachs is forecasting an 8% profit increase for the companies in the S&P 500 index, led by strong mega-cap profit margins and improved macroeconomic outlook in the country. David Kostin, lead strategist at Goldman Sachs, expects the earnings strength of mega-cap stocks, especially those in the Magnificent 7, boosting aggregate S&P 500 profits in 2024. Kostin believes that strong global GDP and a “slightly weaker” dollar will lead to positive EPS.
Wall Street added several consecutive weeks of market recovery since the last few days of October. The “Magnificent Seven”, which includes Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia and Tesla, have played a significant role in this bull run. These stocks benefitted heavily from the significant breakthroughs in generative artificial intelligence. For instance, GPU-maker NVIDIA Corporation (NASDAQ:NVDA) is up more than 430% since the beginning of 2023 and nearly 63% year-to-date, fueled by exponential growth in its revenue.
Our list of 15 worst performing stocks in S&P 500 includes companies from sectors that have been severely impacted by the recent adversity in the stock markets. The list includes companies from nine different sectors with a notable absence – the technology sector. In addition to suffering from macroeconomic and industry-wide market adversity, the stocks on our list of 15 worst performing stocks in S&P 500 have suffered from individual negative catalysts as well. For instance, Archer Daniels Midland Company (NYSE:ADM), the second worst performing stock in S&P 500 year-to-date, is reeling from an accounting scandal as it put its CFO on an administrative leave in late January which saw its stock plummet 24% in a single day.
To recap, the Federal Reserve rapidly increased the interest rates beginning from near zero before March 2022 to the current 5.25%-5.50% range, the highest benchmark rate in the country in 22 years. This led to the failure of several banks in the United States, including the collapse of Silicon Valley Bank with $209 billion assets, and Signature Bank with $110 billion assets, in March, and First Republic Bank with $229 billion assets in May 2023.
Image by Gerd Altmann from Pixabay
Methodology
To create our list of 15 worst performing stocks in S&P 500, we first ranked the S&P 500 stocks based on their year-to-date performance. The stocks in this article have been ranked based on their year-to-date performance, with the worst performing stock ranked the highest. We have also provided hedge fund sentiment data for these stocks for reference.
Data from around 900 elite hedge funds tracked by Insider Monkey in the third quarter of 2023 was used to identify the number of hedge funds that hold stakes in each firm. Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here). That’s why we pay very close attention to this often-ignored indicator.
15. Walgreens Boots Alliance, Inc. (NASDAQ:WBA)
YTD Performance as of February 23: -16.78%
Number of Hedge Fund Holders: 31
Deerfield, Illinois-based Walgreens Boots Alliance, Inc. (NASDAQ:WBA) is an integrated healthcare, pharmacy, and retail leader with more than 12,500 locations across the U.S., Europe, and Latin America. Its portfolio of consumer brands includes Walgreens, Boots, Duane Reade, the No7 Beauty Company, and Benavides in Mexico.
On February 7, Walgreens Boots Alliance, Inc. (NASDAQ:WBA) announced that it has sold shares of Cencora, Inc. (NYSE:COR) for proceeds of $942 million. The transaction reduces the company’s ownership of Cencora, Inc. (NYSE:COR) common stock from 15% to nearly 13%. The company intends to use the proceeds for debt paydown and general corporate purposes.
Earlier on January 4, Walgreens Boots Alliance, Inc. (NASDAQ:WBA) announced a 48% reduction in its quarterly dividend payment to $0.25 per share. The company, and its predecessor company, Walgreen Co., have paid a dividend in 365 straight quarters (91 years).
14. The AES Corporation (NYSE:AES)
YTD Performance as of February 23: -16.88%
Number of Hedge Fund Holders: 35
Arlington, Virginia-based The AES Corporation (NYSE:AES) is a leading global energy company providing green and smart energy solutions. It owned and/or operated a generation portfolio of nearly 33.2 GW as of November 2023.
On January 18, The AES Corporation (NYSE:AES) announced the completion of 3.5 GW of renewables projects in 2023, nearly doubling the capacity constructed compared to 2022. The projects completed in 2023 included 1.6 GW solar, 1.3 GW wind and 0.6 GW energy storage projects.
On February 26, the Board of Directors of The AES Corporation (NYSE:AES) declared a quarterly common stock dividend of $0.1725 per share which translates to an annualized dividend yield of 4.31%, based on the latest share price.
13. FMC Corporation (NYSE:FMC)
YTD Performance as of February 23: -16.92%
Number of Hedge Fund Holders: 31
Philadelphia, Pennsylvania-based FMC Corporation (NYSE:FMC) is a global agricultural sciences company providing products and solutions across biologicals, crop nutrition, digital and precision agriculture. It employs nearly 6,600 personnel at more than 100 sites worldwide.
On February 5, FMC Corporation (NYSE:FMC) released its financial results for Q4 2023. It generated a revenue of $1.15 billion and a net income of $1.1 billion which translates to a normalized EPS of $1.07.
FMC Corporation (NYSE:FMC) currently pays a regular quarterly dividend of $0.58 per share which represents a dividend yield of 4.50% based on the latest share price, the third highest on our list of 15 worst performing stocks in S&P 500.
12. First Solar, Inc. (NASDAQ:FSLR)
YTD Performance as of February 23: -17.06%
Number of Hedge Fund Holders: 47
Tempe, Arizona-based First Solar, Inc. (NASDAQ:FSLR) is a leading American solar technology company and global provider of eco-efficient solar modules. Its thin film photovoltaic (PV) modules provide a competitive, high-performance, lower-carbon alternative to conventional crystalline silicon PV panels.
On January 11, First Solar, Inc. (NASDAQ:FSLR) inaugurated its new facility in Tamil Nadu, India, the country’s first fully vertically integrated solar manufacturing plant. The facility has an annual nameplate capacity of 3.3 GW and marks the company’s sixth operational factory.
On February 14, RBC Capital analyst Chris Dendrinos initiated coverage of First Solar, Inc. (NASDAQ:FSLR) shares with a price target of $195 and an ‘Outperform’ rating for its shares.
11. Carnival Corporation (NYSE:CCL)
YTD Performance as of February 23: -17.85%
Number of Hedge Fund Holders: 41
Miami, Florida-based Carnival Corporation (NYSE:CCL) is a global cruise company and one of the largest vacation companies in the world. Its portfolio comprises of nine leading cruise brands including Carnival Cruise Lines, Holland America Line, Princess Cruises, Cunard, AIDA Cruises, and Costa Cruises, among others.
On December 21, Carnival Corporation (NYSE:CCL) released the financial results for the quarter ended November 30, 2023. Its revenues increased by 41% y-o-y to $5.4 billion, while it generated a net loss of $48 million compared to a net loss of $1.6 billion. The normalized EPS for the quarter was recorded at -$0.07, beating the consensus by $0.06.
As of Q4 2023, Carnival Corporation (NYSE:CCL) shares were held by 41 of the 933 hedge funds tracked by Insider Monkey, with the total hedge fund holdings valued at $1.5 billion. Two Sigma Advisors was the largest hedge fund shareholder with ownership of 16.1 million shares valued at $299 million.
Carnival Corporation (NYSE:CCL) and Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) are the only two travel services stocks on our list of 15 worst performing stocks in the S&P 500.
10. Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH)
YTD Performance as of February 23: -19.31%
Number of Hedge Fund Holders: 31
Miami, Florida-based Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) is a leading global cruise company that operates the Norwegian Cruise Line, Oceania Cruises, and Regent Seven Seas Cruises brands. Its fleet comprises of 32 ships with more than 65,500 berths providing access to nearly 700 destinations globally.
On January 31, Susquehanna analyst Christopher Stathoulopoulos raised the price target for Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) shares from $14 to $20 and maintained a ‘Neutral’ rating for the shares. The target price represents a potential upside of 23.69% based on the latest share price.
As of Q4 2023, 31 of the 933 hedge funds tracked by Insider Monkey were long Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH), holding shares worth $397 million. Its largest hedge fund shareholder was John W. Rogers’ Ariel Investments with ownership of 6.3 million shares valued at $126 million.
9. Humana Inc. (NYSE:HUM)
YTD Performance as of February 23: -20.73%
Number of Hedge Fund Holders: 86
Based in Louisville, Kentucky, Humana Inc. (NYSE:HUM) is a leading U.S. health insurer and healthcare services company. Operating through two segments, Insurance and CenterWell, the company had nearly 17 million members in its medical benefit plans, as well as nearly 5 million members in its specialty products.
On January 25, Humana Inc. (NYSE:HUM) released its financial results for Q4 2023. Its revenue went up by 32% y-o-y to $336 million while it posted a net loss of $540 million. Its normalized EPS of -$0.11 missed consensus estimates by $1.03.
As of Q4 2023, 86 hedge funds held Humana Inc. (NYSE:HUM) shares, the highest on our list of 15 worst performing stocks in S&P 500. Ken Griffin’s Citadel Investment Group was the lead hedge fund shareholder with ownership of 1.5 million shares valued at $688 million.
8. Tesla, Inc. (NASDAQ:TSLA)
YTD Performance as of February 23: -22.74%
Number of Hedge Fund Holders: 82
Based in Austin, Texas, Tesla, Inc. (NASDAQ:TSLA), designs, develops, manufactures, sell and leases fully electric vehicles and energy generation and storage solutions. Its current portfolio of products includes Model 3 and Model S sedans, Model Y, Model X SUVs, and Cybertruck, while upcoming products include Tesla Roadster and Tesla Semi – a light commercial vehicle.
On January 24, Tesla, Inc. (NASDAQ:TSLA) released its financial results for Q4 2023. Its revenue increased by 3% y-o-y to $24.3 billion, while net income surged by 115% y-o-y to $3.7 billion. Its normalized EPS of $0.71 missed consensus estimates by $0.03.
Tesla, Inc. (NASDAQ:TSLA) ranks highest on our list of 15 worst performing stocks in S&P 500 based on the value of shares held by hedge funds. As of Q4 2023, 82 hedge funds owned its shares worth $6.3 billion. In its Q4 2023 investor letter, Tsai Capital Corporation, an investment management firm, made the following comments about Tesla, Inc. (NASDAQ:TSLA):
“Tesla has significant and underappreciated competitive advantages across multiple verticals including electric vehicles, software and energy storage. Misunderstood by much of Wall Street – and consequently a favorite of short sellers – Tesla continues to grow rapidly and increase its lead over the competition while delighting consumers in the process. [. . .] While we expect competition for EVs to intensify and for Tesla to lose market share over time, we also believe the company will increase production and deliveries from approximately 1.8 million vehicles today to approximately 15 million vehicles in 2030 and further its lead in autonomous driving capability. In fact, we expect Tesla will eventually license its autonomous driving software, creating high-margin (70-80%), recurring licensing revenue. Tesla is also one of only two companies that dominate the energy storage market, which has the potential to grow to several hundred billion in revenue as power plants around the world increase their focus on renewable energy.”
7. The Boeing Company (NYSE:BA)
YTD Performance as of February 23: -22.95%
Number of Hedge Fund Holders: 69
Founded in 1916, The Boeing Company (NYSE:BA) is one of the world's largest aerospace companies and a leading provider of commercial airplanes, defense, space and security systems, and global services.
On January 31, The Boeing Company (NYSE:BA) released its financial results for Q4 2023. Its revenue increased by 10% y-o-y to $22 billion while net loss shrunk by 95% y-o-y to $30 million. Its normalized EPS of -$0.47 surpassed consensus estimates by $0.32.
Following the earnings release, RBC Capital lowered the price target for The Boeing Company (NYSE:BA) shares to $260 from $285 and maintained an ‘Outperform’ rating for its shares.
6. Charter Communications, Inc. (NASDAQ:CHTR)
YTD Performance as of February 23: -22.96%
Number of Hedge Fund Holders: 69
Stamford, Connecticut-based Charter Communications, Inc. (NASDAQ:CHTR) is a leading broadband connectivity company and cable operator serving more than 32 million customers in 41 states through its Spectrum brand. It offers a full range of residential and business services including Spectrum Internet®, TV, Mobile and Voice.
On February 2, Charter Communications, Inc. (NASDAQ:CHTR) released its financial results for Q4 2023. Its revenue increased by 0.3% y-o-y to $13.7 billion while it generated a net income of $1.1 billion. Its normalized EPS of $7.07 missed consensus estimates by $1.77.
As of Q4 2023, Charter Communications, Inc. (NASDAQ:CHTR) shares were owned by 69 of the 933 hedge funds tracked by Insider Monkey, for a total value of $5.3 billion. Harris Associates was the largest shareholder with ownership of 5.2 million shares valued at $2.0 billion.
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Disclosure: None.15 Worst Performing Stocks in S&P 500is originally published on Insider Monkey.
