Two stocks on the market’s ‘naughty list’ could be set for a 2022 comeback, traders say
While the broader market enjoys strong gains, some high-profile stocks have suffered steep losses this year. CNBC's "Trading Nation" asked traders which of these battered names might be poised for a recovery in the new year.
Nancy Tengler, CEO of Laffer Tengler Investments, highlighted Block (formerly Square). The payments company's shares have tumbled 23% in 2021, weighed down by regulatory concerns over its "Buy Now, Pay Later" offerings and a perceived slowdown in payment volumes as stimulus checks faded.
However, Tengler sees building tailwinds for 2022. She pointed to Block's recent e-commerce partnership with TikTok and its acquisition of "Buy Now, Pay Later" firm Afterpay as key reasons for optimism. "This is a company that is in the perfect space for disruption," she said, suggesting the hurdles of 2021 may set the stage for a rebound.
Quint Tatro, president of Joule Financial, is eyeing a comeback for Las Vegas Sands. The casino stock has plunged more than 35% this year, hit by a "double whammy" of Covid-19 restrictions on entertainment and its heavy exposure to China. The company derives nearly half its revenue from Macao.
"I do think travel and gaming will come back," Tatro said. "This is a stock that looks fairly cheap, has been beaten up, but I think will do well in the coming years." He believes the stock's severe decline has created an opportunity as the world continues to reopen and travel normalizes.
Both picks represent bets on a reversal of fortunes for companies whose businesses were directly impacted by the unique challenges of 2021, with traders anticipating operational improvements and a more favorable macro environment ahead.
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