4 Stocks Preparing to Get Ruined in June 2015

Dow Chemical Co (NYSE:DOW), Las Vegas Sands Corp. (NYSE:LVS), Procter & Gamble Co (NYSE:PG), and SYSCO Corporation (NYSE:SYY) could hit a rough patch in June

May 29, 2015 at 10:39 AM
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Just yesterday, with help from Schaeffer's Quantitative Analyst Chris Prybal, I took a look at four stocks that could rally next month. However, the market is a double-edged sword with both winners and losers, so I decided to examine some names that have been a little less successful in June. Using data from Prybal, I narrowed in on chemical producer Dow Chemical Co (NYSE:DOW), casino king Las Vegas Sands Corp. (NYSE:LVS), blue chip Procter & Gamble Co (NYSE:PG), and food supplier SYSCO Corporation (NYSE:SYY).

Below, you'll find a list of 33 of the worst performers in June. In order to qualify, the stocks had to be positive no more than 20% of the time in the last 15 years, and have been traded publicly for at least eight years.  Following the list, you'll also find more in-depth commentary on the four aforementioned names -- DOW, LVS, PG, and SYY -- and a case for why they could decline next month.

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Dow Chemical Co (NYSE:DOW)

DOW has been consolidating in the $50-$52 range for the last month, struggling to overtake its year-over-year breakeven level. At last check, the stock was at $51.49. June hasn't been kind to the shares, as they've given up ground in 12 of the past 15 years, with an average loss of 4.5%.

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Nevertheless, traders at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have bought to open 3.20 DOW calls for each put during the past 50 days. This ratio registers in the bullishly skewed 82nd percentile of its annual range. An unwinding of this optimism could exacerbate the equity's technical struggles.

Las Vegas Sands Corp. (NYSE:LVS)

LVS has had a horrible year, tumbling nearly 12% to trade at $51.34. The stock's losses have accelerated, too, since the shares were rejected by their 32-week moving average in mid-April. It doesn't look like things will get better any time soon, as LVS has dropped in eight of the past 10 Junes -- averaging a single-month loss of 6.5%.

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These struggles could be compounded by additional negative analyst attention. Despite LVS' technical woes, one half of covering analysts still consider it worthy of a "buy" or better rating, with not a single "sell" to be found. A round of downgrades could be forthcoming -- especially if the company offers up bad news at its annual shareholder meeting, scheduled for next Thursday, June 4.

Procter & Gamble Co (NYSE:PG)

PG has shed over 16% since hitting an all-time high of $93.89 in late December, and now hovers near $78.56. June could bring additional downside, as the stock has declined in 12 of the past 15 years, averaging a one-month loss of 2.9%.

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A capitulation among option bulls could pressure PG even further. The stock's 10-day ISE/CBOE/PHLX call/put volume ratio of 2.25 ranks just 14 percentage points from an annual optimistic peak.

SYSCO Corporation (NYSE:SYY)

SYY, which is attempting to defend its planned purchase of US Foods, hasn't had a great 2015. Despite hitting an annual high of $41.45 in early January, the shares have since shed 10.2% to trade at $37.20. What's more, SYY has given up ground in 12 of the past 15 Junes, suffering an average one-month loss of 2.5%.

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Should history repeat itself, SYY call buyers could be forced to the exits. During the last 10 weeks across the ISE, CBOE, and PHLX, traders have bought to open 7.74 calls for every put -- a ratio that outstrips 94% of comparable readings from the past year. Should this optimism wane, SYY could encounter headwinds.
 

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