If the economy really is deteriorating as many fear, then there are numerous sectors poised to take even more hits.
In particular, firms with peripheral exposure to the real estate market -- namely office furniture makers, building material suppliers, and construction firms -- face significant hurdles. And within these groups are three names to avoid: HNI (HNI - Get Report), Vulcan Materials (VMC - Get Report), and Perini (PCR).
The overall bearish theme is that these sectors are hurt in a slowing economy as office vacancies rise, commercial construction starts fall, and government spending on transportation infrastructure weakens.
While these stocks are at or near 52-week lows because of their close ties to the real estate slump, they haven't been truly hammered like other sectors, such as the homebuilders.The stocks also aren't heavily shorted yet -- with each carrying a short interest of less than 12% of the float. So hedge funds are looking at these names as the next popular shorts. The companies either declined to comment for this story or could not be reached for comment.