Avoid these stocks in the second quarter, says Piper Sandler
With the second quarter in full swing, Piper Sandler compiled a list of stocks to avoid during the period. Many of the factors that shaped stock performance during the first quarter persist into the second. The war with Iran has caused oil prices to rise and energy stocks to swell. The State Street Energy Select Sector SPDR ETF (XLE) , for example, is up 33% year to date. The S & P 500 Index , meanwhile, is down 3.8% year to date. To get a better sense of where investors should place their bets — and areas one should steer clear of —Piper Sandler considered the following factors: valuation, risk, governance, manipulation, sentiment, profitability and operational efficiency. The stocks in the S & P 1500 with the “most red flags relative to their peer group” made its list. Here is a sample of those names. Real estate services company Cushman & Wakefield made the cut. The firm has had a rocky year with shares down 23% year to date. Investors have seen the stock as a potential victim of artificial intelligence as more service industry tasks are automated. Still, seven of the 11 analysts covering the stock rate it a strong buy or a buy, according to LSEG. The average price target predicts nearly 43% upside could be ahead. Transportation company Uber also made Piper Sandler’s list of potential underperformers. The company has been investing in its fleet over the past year, including a $1.25 billion deal with electric vehicle maker Rivian to deploy 50,000 of its self-driving cars through 2031. The announcement came in March, after Uber had already missed its robotaxi target on several occasions. Shares have dropped by 12% in 2026. Morgan Stanley has an overweight rating on Uber stock and a price target of $100. The bank cited the company’s “multiple large addressable markets” for its bullish thesis. Food distribution company Aramark is also at risk, according to Piper Sandler. Unlike other at-risk stocks, Aramark is up 15% year to date, with JPMorgan listing it as one of its favorite stocks in April . Aramark’s strong 2026 outlook influenced JPMorgan’s stance. On average, Wall Street analysts predict Aramark shares could gain more than 10%, based on the consensus price target. The vast majority of analysts have a strong buy or buy rating on the stock, according to LSEG.
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