The Worst Stocks and Sectors for November

The real estate sector tends to fare especially poorly in the historically bullish month of November

by Andrea Kramer

Published on Oct 25, 2017 at 3:25 PM

While the November-to-April period is historically bullish for the stock market, there's one sector in particular that tends to sit out the November rally: real estate. Below, we'll discuss why short-term bulls may want to avoid the iShares U.S. Real Estate ETF (IYR), and take a look at the 25 worst stocks to own next month, including three real estate stocks -- two of which could move after earnings tonight.

Below are how 34 major exchange-traded funds (ETFs) tend to perform in the month of November. As you can see, the biotech sector tends to fare the best, with the SPDR S&P Biotech ETF (XBI) and SPDR S&P Pharmaceuticals (XPH) boasting average November gains of at least 3.5% over the past decade. However, the IYR has ended the month higher just 20% of the time in 10 years, according to Schaeffer's Senior Quantitative Analyst Rocky White, and averages a monthly loss of 3.39%.

ETF returns in November


As such, it's not surprising to find that three of the four worst S&P 500 Index (SPX) stocks in November fall under the Real Estate umbrella. Below is a list of the 25 worst stocks to own in November, if past is prologue. To make the list, stocks had to have at least eight returns.

worst SPX stocks November


Duke Realty Corp (NYSE:DRE) -- which reports earnings after the close today -- is typically the worst SPX stock in November, averaging a loss of 9.35%, and positive just once in the past decade. The shares have been in a channel of higher highs and lows since the 2009 bottom, but have struggled recently to top the round-number $30 level. At last check, Duke Realty stock was fractionally higher on the day, trading at $28.68. Another 9.35% drop next month would put DRE around $26 -- below most of its major moving averages, but still within the aforementioned channel.

DRE stock chart


Kimco Realty Corp (NYSE:KIM) also reports earnings tonight, and sports a November win rate of  just 10%, averaging a monthly loss of 6.76%. Like DRE, KIM shares were in the midst of a long-term uptrend, but after peaking north of $32 in mid-2016, broke south of their channel. At last check, Kimco stock was 1.4% lower at $18.46. Another 6.75% loss in November would put the shares around $17.21 -- just cents from their four-year low of $17.02, touched in early June.

KIM stock chart


Regency Centers Corp (NYSE:REG) -- relatively new to the S&P 500 -- will report earnings after the close on Wednesday, Nov. 1. REG stock has averaged a November loss of 4.84%, and has ended the month higher just once in the past 10 years. Since running into familiar resistance in the $85 neighborhood back in mid-2016, Regency Centers stock has broken south of its long-term channel of higher highs and lows, with recent rebound attempts capped at its 200-day moving average. At last check, the equity was down 0.9% at $62.80, and another 4.84% drop would place it around $59.74 -- in an area that contained pullbacks earlier this year.

REG stock chart


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