The consumer discretionary sector is currently presenting opportunities for investors to potentially buy into undervalued companies. The RSI (Relative Strength Index) is a valuable momentum indicator that helps traders gauge a stock’s strength by comparing its performance on days when prices rise to its performance on days when prices fall. Generally, an asset is deemed oversold when its RSI dips below 30. This article examines three stocks in the consumer discretionary sector currently exhibiting RSI values near or below 30, signaling potential oversold conditions.
Topgolf Callaway Brands Corp (MODG)
Topgolf Callaway Brands reported weaker-than-expected second-quarter revenue results and issued a cautious third-quarter revenue outlook on August 7th. Despite this, CEO Chip Brewer emphasized the company’s success in gaining market share for its products and improving the profitability of its Topgolf venues. Despite this, the company’s stock has experienced a decline of around 27% over the past month, reaching a 52-week low of $9.84. Currently, MODG’s RSI sits at 29.11.
Red Robin Gourmet Burgers Inc (RRGB)
Red Robin reported disappointing earnings for the second quarter and lowered its FY24 revenue guidance on August 22nd. Red Robin’s CEO, G.J. Hart, acknowledged that the company’s results fell short of expectations, attributing this to a broader slowdown in the restaurant industry. Nevertheless, he highlighted the company’s continued progress in implementing its strategic plan. Red Robin’s stock has fallen approximately 22% over the past month, reaching a 52-week low of $4.50. RRGB’s RSI is currently at 26.81.
Genius Group Ltd (GNS)
On August 16th, Genius Group announced a reverse stock split. The company’s shares have subsequently declined by around 32% over the past five days, hitting a 52-week low of $1.03. Genius Group’s RSI is currently at 25.58.
It’s important to note that an oversold condition doesn’t guarantee a stock will rebound. However, for investors seeking potential buy opportunities, these companies might warrant further investigation. Investors should conduct thorough research and consider their own risk tolerance before making any investment decisions.
