In any market, at any time, there are stocks whose values are down significantly. But during a market correction, there will be more of those, and you may find opportunities to scoop up bargains for extra profits when the broader market rebounds.
In mid-October, data provided by FactSet showed that exactly half of the stocks included in the S&P 500 Index were down at least 20% from their all-time highs. With the market pulling back since then, it might be interesting to use more recent data to see which ones have declined the most from their 52-week highs.
A bear market for an index or an individual stock is usually defined as a 20%-plus decline. At about 11:10 a.m. ET on Nov. 26, 206 stocks among the S&P 500 were down at least 20% from their 52-week highs. That’s a huge list, but it might be of interest to see which of the companies in bear territory are favored the most among Wall Street analysts, whose research is used by their broker colleagues to help push stock purchases.
Correction time
The Dow Jones Industrial Average DJIA, +1.46% fell 10% from its intraday high on Oct. 3 through its intraday low on Nov. 23. The S&P 500 Index SPX, +1.55% was down 10.5% from its intraday high on Sept. 21 through its intraday low on Nov. 23. Both benchmark indices had suffered corrections earlier in 2018. The Dow ended on Nov. 23 down 1.8% for the year, while the S&P 500 was down 1.5%.
The Dow was last in a bear market heading to the post-crisis low on March 9, 2009. But even though the financial media generally agree that the bull market has continued from that date, the S&P 500 on an intraday basis was in a bear market when it fell 20.2% from an intraday high on July 1, 2011, through its intraday low on Oct. 4, 2011, according to data supplied by FactSet.
Bear territory
Starting with the 206 S&P 500 stocks in bear territory (from 52-week highs) through 11:10 a.m. ET on Nov. 26, we have narrowed the list to 22 companies that are covered by at least 10 analysts, with at least 80% of the analysts rating the shares a “buy” or equivalent, according to FactSet.
