3 Stocks to Avoid Like the Plague in 2024

Market Overview - The S&P 500 and Nasdaq have shown impressive year-to-date gains, but underlying warning signs exist that should not be ignored [1] - The market's resilience is notable despite elevated interest rates and global economic weakness, with strong consumer spending and business investment supporting steady GDP growth [1] - Many businesses are underperforming and may face further challenges in the upcoming quarters, suggesting that selling certain stocks may be prudent [1] GameSquare (GAME) - GameSquare is a Gen Z-oriented company focused on digital media but is struggling to connect with its target audience [2] - The company reported a net loss of $5.3 million in Q1 2024, which is $1 million higher than the previous year, raising liquidity concerns as short-term obligations exceed liquid assets [2] - GAME stock has experienced significant volatility, with a one-week price return of nearly -12%, and the company's widening losses and merger integration risks contribute to a bearish outlook [3] AMC Entertainment (AMC) - AMC is heavily burdened by debt and faces challenges competing with streaming services, leading to a grim outlook [4][5] - The company's stock has fallen over 85% in the past year, and S&P has downgraded its credit rating further into junk territory [5] - An acquisition by a larger player may be the only viable path forward for AMC, but the substantial debt may deter potential buyers [6] Ginkgo Bioworks (DNA) - Ginkgo Bioworks has encountered significant challenges, with Q1 revenue dropping 53% year-over-year to $38 million and net losses of $165.9 million [7] - The company has a dismal net margin of -437.25%, raising concerns about its ability to achieve profitability without drastic changes [7] - Ginkgo faces the risk of delisting from the NYSE if its stock price does not recover, and despite having $840 million in cash, its current burn rate limits its runway [8]