When deciding which stocks to invest in, understanding which exchanges they are listed on can make a big difference in long-term performance and perception. For most U.S.-based investors, the two exchanges they hear about the most are the New York Stock Exchange (NYSE) and the Nasdaq. The NYSE is known for its relative stability and historically blue-chip stocks. On the other hand, the Nasdaq is a staple of high-growth and more speculative ventures like information technology, biotechnology and market disruptors. Yet, due to this reputation, Nasdaq stocks tend to be more volatile over short periods, leading to some Nasdaq stocks to sell.
In the case of these three companies, both broader market pressures and institutional overvaluations have put them in positions worth selling from. Furthermore, these companies may be at the end of their speculative roads, leading investors to want more growth where there may not be any left.
BioNTech (BNTX)
A product of the COVID-19 pandemic, BioNTech (NASDAQ:BNTX) has been steadily losing value ever since its meteoric spike from developing a vaccine alongside Pfizer (NYSE:PFE). The best time to have sold would have been back in 2021 to take advantage of its extreme overvaluation at the time.
Today, the company focuses on utilizing the mRNA drug delivery platform to treat cancer and has several such fully-owned drugs in the pipeline for diseases like melanoma and head and neck cancer. The company also deeply invests in its collaborative efforts for protein-based cancer therapies as well. While these goals may be admirable, they are not likely to take BNTX stock back up to the $350 range it was trading at during the height of the pandemic.
Rather, BNTX now represents a respectable biotech stock that has more modest long-term growth potential. That said, its current price still needs some correction as its lack of profitability and revenue growth could begin to turn investors away.
Starbucks (SBUX)
Once touted as a symbol of American capitalism, Starbucks (NASDAQ:SBUX) may struggle to find its footing in an ever-financially savvy consumer market. Americans are more focused on saving money where they can as the dollar loses power due to inflation and the cost of essentials like housing and food are at all-time highs.
Thus, the business model of selling overpriced coffee may be going out of fashion, especially as coffee culture in the U.S. grows and encourages people to take brewing into their own hands. Yet, it’s not just less consumer spending that could damage SBUX stock’s long-term trajectory. Recently, both efforts to unionize amongst its workers and the rising cost of minimum wage in the U.S. are likely to cut into its profit margins.
Pair these factors with an ultimately non-essential product, and SBUX may be one of the Nasdaq stocks to sell before it continues to lose its value.
Tesla (TSLA)
Being bearish on Tesla (NASDAQ:TSLA) is not contrarian; it’s rational. That’s because the company’s current valuation stems from an overall misconception about its purpose. For the better part of a decade, many investors treated Tesla as a technology company that happened to test and market that technology through its cars. However, the reality and market dynamics of the auto industry are starting to catch up with TSLA stock.
For starters, its cars are still simply too expensive for the average American to afford. Consider the metric that 28% of Americans don’t even have $1,000 in cash savings. This means one of Tesla’s primary markets remains so financially burdened that it cannot afford the price of a new electric vehicle. Then consider the impracticality of Tesla vehicles across the majority of U.S. states which are so large that charging and range anxiety become an issue.
The combination of these practical factors alongside the fact that hybrid engines are a more pragmatic approach to cleaner transportation is likely to continue whittling away at TSLA’s share value. As such, Elon Musk’s foray into the auto industry might result in one of the best Nasdaq stocks to sell.
On the date of publication, Viktor Zarev did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.