In this list, Exelon is by far the highest risk short term, but over the longer run, offers the greatest potential. In a perfect world, I would enter long AFTER a cut in dividend. Low natural gas prices are pushing margins lower, but also create an incentive to move away from gas and diesel as a transportation fuel, into natural gas.
We don't know if the dividend will get cut, and it's too much risk unless you're able to view Exelon as a long term hold.
Shares traded slightly lower in the last month of trading. Shares are about breaking even at 1% less than a month ago.
Analyst opinion is mixed. Exelon has four buy recommendations out of 22 analysts covering the company, and 18 holds. The average analyst target price for Exelon is $33.88.
Direxion Daily Financial Bear 3X (FAZ) Background: Unlike most of the stocks I cover, this one is a fund that allows traders to short the financial market without taking an unlimited amount of risk. This is a leveraged product, but don't let the 3X fool you. My experience is that leveraged products rarely mimic the underlying at a rate equal to the stated amount over a long period of time. The FAZ is best suited as a day trading product. 52 Week Range: $13.37 to $34.69 As a leveraged exchange traded fund product, technical analysis is the primary method I use to determine the relative price and expected upcoming price direction. FAZ is oversold on the daily and weekly charts based on my technical analyst. I have a price target of $15.
FAZ data by YCharts
ACI Revenue Quarterly data by YCharts
Arch Coal (ACI) Background: Arch Coal engages in the production and sale of steam and metallurgical coal from surface and underground mines located in the U.S. 52 Week Range: $5.16 to $15.99 Price To Book: 0.5 Arch Coal is experiencing a one-two punch from the current administration's lack of enthusiasm for the coal industry, along with record low natural gas prices. Low natural gas prices mean coal is experiencing displacement from power producers for the fuel choice.
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