Take-Two Interactive Software, Inc. (TTWO), Netflix, Inc. (NFLX), and U.S. Bancorp (USB) tend to underperform after Christmas
Around this time last year, we took a look at the best and worst performing stocks during the week leading up to Christmas. This time, we're looking ahead a bit at how individual stocks have historically performed during the week between Christmas and New Year's.
The list below includes the 30 worst performers during the post-Christmas week over the past 10 years, and data is courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. Included in our study were all optionable stocks trading above $10, as of Monday's close, that have been trading for at least eight years. Among the names traders may want to avoid next week are video game creator Take-Two Interactive Software, Inc. (NASDAQ:TTWO), streaming entertainment stock Netflix, Inc. (NASDAQ:NFLX), and financial interest U.S. Bancorp (NYSE:USB).
Of all the stocks in our study, TTWO is the only name that has failed to see even one positive return in the week between Christmas and New Year's over the last 10 years. In fact, the shares have averaged a loss of nearly 2% for the week over the past decade. That might be just what short sellers are hoping for this year. More than 15% of TTWO's available float is currently wrapped up in these bearish bets, representing more than six sessions' worth of buying power, at the stock's typical daily pace. Take-Two Interactive Software, Inc. has had a solid 2016 so far, however, tacking on 41.7%, and hitting a record high of $51.34 just last week. For now the shares seem to have a firm foothold above the 30-day moving average, and TTWO is up 0.6% at $49.36 this morning.
NFLX has had a positive post-Christmas week twice in the past 10 years, with an average return of negative 1.2%. The stock is 0.2% higher at $125.65 today, and Netflix, Inc. is up nearly 10% year-to-date. Options traders have been busy betting on more gains ahead, too. Specifically, the stock's 10-day call/put volume ratio at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) now sits just 2 percentage points from an annual bullish high, at 1.81.
Finally, bank stocks have been soaring since Election Day, and USB is no exception. The stock has tacked on 16.7% since its Nov. 8 close, and is up 1.2% at $52.47 today, after hitting a fresh all-time high of $52.56 earlier in the session. However, given this recent rally, the stock's 14-day Relative Strength Index (RSI) is now well into overbought territory, at 76, suggesting a breather may be overdue. And if a pullback comes next week, it should be little surprise, given U.S. Bancorp's average post-Christmas week return of negative 0.7% over the last decade. Moreover, the stock has given a positive return in the week between Christmas and New Year's just one time out of the past 10 years. Some traders may already be bracing for trouble head, too. Short interest on USB climbed by nearly 20% during the two most recent reporting periods.
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