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Why You Need to Avoid These 3 Downgraded Stocks

Our proprietary POWR Ratings system evaluates stocks based on 118 different factors. Investors should only consider buying stocks rated a Strong Buy or Buy, and should definitely avoid stocks rated a Sell or Strong Sell. Editas Medicine (EDIT), Vislink Technologies (VISL), and easyJet (ESYJY) are three stocks that were recently downgraded Strong Sell and should be avoided.

Our proprietary POWR Ratings system is designed to shift the odds in favor of you, the retail investor. Make prudent use of these ratings, and you will be that much more confident investing your hard-earned money in publicly traded companies. The POWR Ratings also extend to ETFs.

Investors are encouraged to check the POWR Ratings to get a sense of which stocks are ascending and descending from Sells to Holds, Holds to Buys, Buys to Strong Buys, and so on. Unfortunately, there is also the potential for stocks to be downgraded to Sells and Strong Sells.

Editas Medicine (EDIT), Vislink Technologies (VISL), and easyJet (ESYJY) are three of the latest examples of stocks downgraded to Strong Sell ratings. 

Editas Medicine (EDIT)

Based in Cambridge, Editas Medicine is a biotech business focused on genome editing. EDIT's medicines treat serious diseases with the use of proprietary genome editing technology. The company's medicines are particularly helpful for those suffering from ocular diseases. The company's unique gene-editing platform is centered on the much-hyped CRISPR technology. Though CRISPR is undoubtedly an on-trend, buzzworthy acronym in the investing community, it is not enough alone to warrant investment.

EDIT leaves much to be desired in the context of the POWR Ratings. The stock has an overall grade of F, which translates into a Strong Sell rating in our POWR Ratings system. The company has a Value Grade of C and Fs in the Growth and Stability components. Investors are invited to click here to learn more about EDIT's Sentiment, Quality, and Momentum grades.

Of the 509 stocks in the Biotech industry, EDIT is ranked near the bottom at 489th. However, you can find the top stocks in this industry by clicking here. EDIT has a 1.95 beta, which means the stock is almost twice as volatile as the market. Analysts are bearish on EDIT, setting an average target price of $50.83. If EDIT declines to this level, it will have dipped by nearly 18%.

Vislink Technologies (VISL)

VISL designs, manufactures, and implements live video communication technology. VISL clients are in public safety, defense, and law enforcement. The company's high-def communication technology connects for the reliable video capture, transmission, and management of video from live events.

VISL is a penny stock trading at $2.08. The stock's 52-week high is $5.35, while its 52-week low is $1.11. VISL's beta of 1.78 means it is much more volatile than the market. The latest news stories pertaining to the company's financial statements are pretty critical. These reports state that VISL debts over $13 million are due within the year.

VISL is a POWR Ratings loser with an overall grade of F and a Strong Sell rating in our POWR Ratings system. The company has a Stability Grade of F and Ds in the Quality, Sentiment, and Value components. Click here to find out how VISL grades in the Growth and Momentum components. The stock is ranked 43 out of 46 in the Technology – Hardware industry. Investors can find the top stocks in this industry by clicking here.

easyJet (ESYJY)

Now that the demand for air travel has returned to pre-pandemic levels, it might seem logical to invest in a low-cost passenger carrier in an attempt to capitalize on the pricing war. Though ESYJY provides affordable airfare, the company is not investable in its current position. Even if you don rose-colored glasses to conveniently overlook the potential for air travel to slow to a snail's pace due to the MU variant of coronavirus or another variant, ESYJY still is not worth your investing dollars.

ESYJY conducts operations in mainland Europe and the United Kingdom. This Britain-based multinational airline operates 1,000+ routes across more than two dozen nations. These flights are provided by the company's affiliate airlines, such as EasyJet Switzerland and EasyJet UK.

Furthermore, out of the 31 stocks in the Airlines industry, ESYJY is ranked 30th. Investors can find out the top-ranked stocks in this industry by clicking here.

Above all, ESYJY is to be avoided due to its overall grade of F. This translates into a Strong Sell rating in our POWR Ratings system. ESYJY also has a grade of F in the Quality, Value and Growth components. For the rest of its component grades, including Momentum, Stability, and Sentiment, click here


EDIT shares were trading at $71.35 per share on Tuesday morning, up $3.10 (+4.54%). Year-to-date, EDIT has gained 1.77%, versus a 21.60% rise in the benchmark S&P 500 index during the same period.



About the Author: Patrick Ryan

Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management.

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