In this article, we will look at the 5 worst-performing S&P 500 stocks in 2022. If you want to explore similar stocks, you can also take a look at 10 Worst-Performing S&P 500 Stocks in 2022.
5. NVIDIA Corporation (NASDAQ:NVDA)
Year to Date Return as of September 16: -56.49%
Number of Hedge Fund Holders: 84
At the end of Q2 2022, 84 hedge funds were bullish on NVIDIA Corporation (NASDAQ:NVDA). The total stakes of these hedge funds amounted to $3.31 billion, down from $6.35 billion in the previous quarter with 102 positions.
This September, Evercore ISI analyst C.J. Muse cut his third-quarter revenue estimates for NVIDIA Corporation (NASDAQ:NVDA) by $250 million but maintained an Outperform rating and his $225 price target on the stock. Muse noted that the risk/reward ratio for NVIDIA Corporation (NASDAQ:NVDA) is “extremely attractive” at current levels. As of September 16, the stock has lost 56.49% year to date and is trading at a PE multiple of 35x.
On September 15, Mizuho analyst Vijay Rakesh slashed his price target on NVIDIA Corporation (NASDAQ:NVDA) to $205 from $225 but maintained a Buy rating on the shares.
As of June 30, Fisher Asset Management is the top shareholder in NVIDIA Corporation (NASDAQ:NVDA) with stakes worth $1.15 billion. The investment covers 0.81% of Ken Fisher’s 13F portfolio.
Here is what Baron Funds had to say about NVIDIA Corporation (NASDAQ:NVDA) in its second-quarter 2022 investor letter:
“At the company-specific level, there was a broad correction across the entire portfolio. While four of our holdings contributed to performance, the contribution to absolute returns was less than 100bps combined, as unfortunately none of them were large enough to move the needle. We had 16 investments detracting over 100bps each with NVIDIA (NASDAQ:NVDA), our second largest detractor, costing the Fund 254bps.
NVIDIA’s stock was hit even harder, down 44.4%, impacted by concerns over the health of the consumer, dramatic declines in crypto, and COVID-related lockdowns in China. Despite the sell-off and the increased near-term volatility in its gaming business, NVIDIA’s revenues grew 46% year-over-year with 48% operating margins, driven by continued strength in its data center business as companies across industries adopt AI and ML…” (Click here to see the full text)
4. Meta Platforms, Inc. (NASDAQ:FB)
Year to Date Return as of September 16: -56.91%
Number of Hedge Fund Holders: 184
Meta Platforms, Inc. (NASDAQ:FB) is crashing in 2022. Shares of the social media giant have fallen 56.91% year to date as of September 16. On September 13, Morgan Stanley analyst Brian Nowak estimated that the total time spent on Meta’s social media platforms in the U.S. declined 3% year-over-year in August. The analyst reiterated his Overweight rating and $225 price target on the stock.
This September, Piper Sandler analyst Thomas Champion slashed his price target on Meta Platforms, Inc. (NASDAQ:FB) to $175 from $190 and maintained a Neutral rating on the stock.
At the end of the second quarter of 2022, 184 hedge funds were bullish on Meta Platforms, Inc. (NASDAQ:FB) and held stakes worth $18 billion in the company. This is compared to 200 hedge funds in Q1 2022, with stakes worth $19.3 billion.
As of June 30, Fisher Asset Management owns more than 11.5 million shares of Meta Platforms, Inc. (NASDAQ:FB) and is the leading investor in the company. The fund’s stakes are valued at $1.86 billion.
Here is what Saga Partners had to say about Meta Platforms, Inc. (NASDAQ:FB) in its second-quarter 2022 investor letter:
“Meta (formerly known as Facebook, when I discuss the social media apps specifically, I’ll still refer to Facebook). The Portfolio first bought Meta in Q4’18. It was a controversial investment then and has continued to be to this day. The core mission of the company has been to make the world more open and connected. To do that, it needs to connect everyone in the world, which it largely has done with its nearly 3 billion monthly active users across its family of apps (Facebook, Instagram, and WhatsApp). That type of scale is hard to grasp and is getting pretty close to essentially every smartphone user outside of China and Russia.
From an investing perspective, there are questions surrounding Apple’s iOS App Tracking Transparency (ATT) changes that limit sharing user data across apps, investments in virtual reality (VR) and augmented reality (AR) i.e. the metaverse, and competitive threats surrounding the rise of TikTok. It seems like only yesterday (or last year) that one of the major risks of Facebook was that the company was too powerful, had too much influence on public opinion, and faced antitrust and regulatory concerns…” (Click here to see the full text)
3. Match Group, Inc. (NASDAQ:MTCH)
Year to Date Return as of September 16: -58.50%
Number of Hedge Fund Holders: 54
Match Group, Inc. (NASDAQ:MTCH) is an internet and technology company that provides dating services and products worldwide. The company owns and operates a variety of dating platforms. Some of its most notable dating services include Tinder, Match.com, Meetic, and Hinge among others.
On August 2, Match Group, Inc. (NASDAQ:MTCH) announced earnings for the second quarter of fiscal 2022. The company reported earnings per share of $0.69 and beat expectations by $0.07. The company’s revenue for the quarter amounted to $794.5 million and fell short of Wall Street estimates by $10.9 million. As of September 16, Match Group, Inc. (NASDAQ:MTCH) has lost 58.50% of its value since the beginning of 2022.
On September 14, Loop Capital analyst Laura Champine slashed her price target on Match Group, Inc. (NASDAQ:MTCH) to $60 from $70 and downgraded the stock to Hold from Buy.
At the close of Q2 2022, 54 hedge funds held stakes in Match Group, Inc. (NASDAQ:MTCH) worth $847 million. This is compared to 55 hedge funds in Q1 2022 with stakes worth $1.87 billion.
2. Netflix, Inc. (NASDAQ:NFLX)
Year to Date Return as of September 16: -59.65%
Number of Hedge Fund Holders: 95
On July 19, Netflix, Inc. (NASDAQ:NFLX) announced earnings for the fiscal second quarter of 2022. The streaming services giant reported revenue of $7.97 billion and missed expectations by $63.85 million. The company also reportedly lost roughly 1 million subscribers in Q2 2022. As of September 16, Netflix, Inc. (NASDAQ:NFLX) has lost 59.65% year to date.
On September 14, Netflix, Inc. (NASDAQ:NFLX) announced that it expects 4.4 million unique users of the company’s ad-supported tier of Netflix, by the end of 2022. The company is forecasting 40 million unique subscribers of its ad-supported plan in 2023, of which 13.3 million are expected to be from the United States.
On September 16, Citi analyst Jason Bazinet raised his price target on Netflix, Inc. (NASDAQ:NFLX) to $305 from $275 and reiterated a Buy rating on the shares.
At the close of the second quarter of 2022, 95 hedge funds disclosed ownership of stakes in Netflix, Inc. (NASDAQ:NFLX). The total value of these stakes amounted to $4.72 billion, down from $9.70 billion in Q1 2022 when 109 hedge funds held stakes in the company. The hedge fund sentiment for the stock is negative.
As of June 30, Fisher Asset Management is the largest investor in Netflix, Inc. (NASDAQ:NFLX) with stakes worth $1.14 billion. The investment covers 0.81% of Ken Fisher’s 13F portfolio.
Here is what asset management firm, Militia Capital, had to say about Netflix, Inc. (NASDAQ:NFLX) in its second-quarter 2022 investor letter:
“A few investors asked me specifically about the Netflix, Inc. (NASDAQ:NFLX) bet. I broke even since I trimmed a lot at $650, bought more at $375, and then sold it all at $440 when the price spiked on news that Bill Ackman bought shares. I got lucky even if there was some skill. I couldn’t even fully explain my trades – a detailed explanation would be post hoc nonsense. The likely answer is that I subconsciously absorbed many market patterns and just dodged the bullet in time.
Last quarter Netflix guided to losing 2 million subscribers. This came out of nowhere. Not a single bear predicted anything like this. This is catastrophically bad if it means that Netflix will shrink from here. I don’t think so and I got long again. How could Netflix management know they are going to lose those subscribers in April unless it’s part of their plan to prevent account sharing, which wouldn’t really be such bad news. If Netflix either starts growing again, or if they have lots of untapped pricing power and maintain their subscriber base, shares will rapidly go to $300+. On the other hand, if they lose 2 million subscribers and guide to higher attrition, Netflix might drop another 50%…” (Click here to view the full text)
1. Align Technology, Inc. (NASDAQ:ALGN)
Year to Date Return as of September 16: -61.54%
Number of Hedge Fund Holders: 33
Align Technology, Inc. (NASDAQ:ALGN) is a leading medical device company that designs and manufactures 3D digital scanners and Invisalign clear aligners which are used in orthodontics. As of June 30, Bares Capital Management is the most prominent shareholder in Align Technology, Inc. (NASDAQ:ALGN) and owns more than 0.6 million shares of the company.
On July 27, Align Technology, Inc. (NASDAQ:ALGN) reported weak earnings for the second quarter of fiscal 2022. The company generated a revenue of $969.5 million, down 4% year over year, and missed estimates by $16.49 million. The company reported earnings per share of $2.0 and missed Wall Street expectations by $0.23. As of September 16, Align Technology, Inc. (NASDAQ:ALGN) has lost 61.54% since the beginning of 2022.
On September 9, Piper Sandler analyst Jason Bednar slashed his price target on Align Technology, Inc. (NASDAQ:ALGN) to $340 from $370 but maintained an Overweight rating on the shares.
At the end of the second quarter of 2022, 33 hedge funds were long Align Technology, Inc. (NASDAQ:ALGN) and held stakes worth $738 million in the company. This is compared to 45 hedge funds in the preceding quarter with stakes worth $1.20 billion.
RGAIA Investment Advisors mentioned Align Technology, Inc. (NASDAQ:ALGN) in its recently published second-quarter 2022 investor letter. Here is what the firm said:
“Align Technology (NASDAQ:ALGN)– we have followed Align with admiration for years. The company has consistently executed its combination of profitable growth, while disrupting the orthodontics industry and enhancing its offering beyond the pure product. Specifically, Align’s Invisalign is by far the best clear aligner and the company has used its offering to build what is essentially the “operating system” foran orthodontics practice. COVID Stimulus led to a surge in demand from which there is now a hangover.
Consequently Align is at its lowest valuation multiple in a decade (sub 15x EV/EBITDA); lower than when fears of a patent expiration led some to believe emergent competition could derail Align’s momentum (it did not). Align is more “discretionary” than the typical healthcare company, because their core clientele are adult patients with orthodontic problems. This means there is some portion of cyclicality; however, the really long-term opportunity is capturing the core teenager orthodontic industry, which remains the vast majority (over 80%) treated with metal braces.
It is inherently more challenging to drive adoption in this demographic considering invisible aligners are more expensive and require patient compliance, though we think the generation growing up seeing themselves on Instagram and TikTok will inevitably steer towards clear, where Align is dominant. As they say, the future here is bright.”
You can also take a look at 10 Underperforming Stocks Targeted By Short Sellers and 15 Worst Stock Picks of Cathie Wood.
