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To be completely upfront, stocks to sell represent a terribly unpopular subject for obvious reasons. Still, I hope you’ll extend me some rope so that I can make my case. Each of the companies you see appear on this list for the following main reasons:
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They all skyrocketed sharply this year.
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Worse yet, they feature questionable business models or relevance.
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Generally, their 15 minutes of fame may be up.
Ultimately, what I’m trying to do is to protect you from the occasional irrationality of the market. You might be enthralled with these ideas and that’s okay. Just consider a different perspective as part of your due diligence. And on that note, here are (in my opinion) the stocks to sell.
Ambow Education (AMBO)
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Based on Barchart’s year-to-date performance screener, Ambow Education (NYSEAMERICAN:AMBO) clocks in as one of the top performers, gaining a stratospheric 120%. And most of that performance occurred recently, with AMBO skyrocketing 150% in the past five sessions. Specializing in educational software and hardware, Ambow’s platform should enable hybrid online and offline learning. That may be the future of education.
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Except maybe it’s not. I’m not trying to cast aspersions as I believe the concept is intriguing. However, back when the Covid-19 crisis forced so-called distance learning protocols, the matter sounded better in theory. However, in practice, teachers suffered through significant challenges. I anticipate more of the same moving forward.
Yes, Ambow states that the company has a long history of success in China. But that’s a different country, a different culture. Here in the U.S., educational technology (edtech) firms have had mixed success. Plus, on a technical (analysis) level, AMBO shows a high pole warning in its point-and-figure (P&F) chart.
I think the signs are clear. You should consider AMBO one of the stocks to sell.
Pop Culture Group (CPOP)
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While you shouldn’t judge a book by its cover, Pop Culture Group (NASDAQ:CPOP) just seems an odd enterprise. According to its website – it’s in Chinese so something may have been lost in translation – Pop Culture goes by the brand nickname “Pupu.” Essentially, it’s a Chinese hip-hop culture company that broadly supports friendship between the U.S. and China. As for its core business, the company provides event experiences focused on disseminating hip-hop elements.
Interestingly, hip hop and other components of Black American popular culture has taken root in China. So, it’s not out of the question for CPOP stock to rise higher. However, it’s also true that the Chinese government has taken action against its own hip-hop stars. Given the heightened censorship environment – along with rising geopolitical tensions – it’s quite possible that the communist government could clamp down on certain cultural catalysts.