Investors aiming to reduce their tax liabilities may consider utilizing a well-established strategy that involves selling underperforming stocks. This practice, known as tax-loss harvesting, is a typical year-end technique employed by investors and portfolio managers to decrease tax burdens. The strategy involves selling off investments that have declined in value to counterbalance taxes on realized gains from profitable investments. Using its stock-screening tool, CNBC Pro identified stocks with market capitalizations exceeding $1 billion and losses accumulated throughout the year. Each stock also has an average trading volume of more than 500,000 shares, and the price targets suggest a potential decrease of 5% from current levels. Here is the list of the stocks identified as of midday Friday:
Fastly, a cloud platform company, has experienced the most substantial losses year-to-date among the screened stocks, with its stock declining approximately 57%. The average price target indicates that shares might drop about 18%. D.A. Davidson analyst Rudy Kessinger maintains a neutral stance on Fastly. In August, he adjusted his price target from $8.50 to $5.50, highlighting a significant downward revision in Fastly’s outlook for the fiscal year 2024. He noted that “FSLY added just 5 net new customers in Q2 compared to 47 in the previous quarter, though the company added 24 customers with contracts over $100,000 in Q2 after losing 1 in the previous quarter.”
Carter’s, a children’s apparel manufacturer, is also on the list, with its shares down 9% over the past year. Analysts predict more than 10% further downside. During the summer, the company provided weak full-year guidance for both revenues and earnings.
Figs, a scrubs manufacturer, meets the screener’s criteria as well. As of Friday, the company’s shares have declined over 3% in 2024, with analysts projecting a 10% decrease according to consensus price targets.
In the real estate sector, Kennedy-Wilson might face the most significant decline within the discussed group, with consensus price targets indicating a potential fall of another 22%. The stock has already fallen nearly 13% in 2024 as of Friday. Other companies that appear on the list include Arbor Realty Trust and Leggett & Platt.
