Top 5 Materials Stocks That May Crash This Quarter

As of Dec. 8, 2023, five stocks in the materials sector could be flashing a real warning to investors who value momentum as a key criteria in their trading decisions.

The RSI is a momentum indicator, which compares a stock's strength on days when prices go up to its strength on days when prices go down. When compared to a stock's price action, it can give traders a better sense of how a stock may perform in the short term. An asset is typically considered overbought when the RSI is above 70, according to Benzinga Pro.

Here’s the latest list of major overbought players in this sector.

Ranpak Holdings Corp. PACK

• On Oct. 31, Ranpak Hldgs posted a narrower-than-expected third-quarter loss. "We are pleased to report continued improvement in our operating and financial profile as volumes increased year over year and we continue to see gross margin expansion," said Omar M. Asali, Chairman and Chief Executive of Ranpak. The company’s stock jumped around 51% over the past month and has a 52-week high of $8.24 .
• RSI Value: 71.40
• PACK Price Action: Shares of Ranpak Holdings gained 7% to close at $4.61 on Thursday.

Stepan Company SCL

• On Oct. 18, Stepan reported a third-quarter FY23 sales decrease of 22% year-on-year, to $562.226 million. "Specific to the third quarter, Surfactant unit margins were lower versus the prior year due to less favorable product mix, high-cost raw material inventory carryover, and pricing pressure in Latin America from imported products. Specialty Product unit margins were significantly lower due to high-cost inventory and pricing pressure related to increased MCT import activity," said Scott Behrens, President and Chief Executive Officer. The company’s stock gained around 17% over the past month and has a 52-week high of $114.97.
• RSI Value: 82.17
• SCL Price Action: Shares of Stepan gained 4.2% to close at $89.34 on Thursday.

Orion S.A. OEC

• On Nov. 2, Orion Engineered Carbons posted upbeat quarterly earnings. "I am pleased to announce that we delivered $77 million of Adjusted EBITDA this quarter in the face of weak demand in many of our key markets. In addition, for the nine months, we achieved record adjusted diluted earnings per share up $0.06, to $1.76 from prior year," said Corning Painter, Orion’s chief executive officer. The company’s stock jumped around 22% over the past month and has a 52-week high of $26.91.
• RSI Value: 81.81
• OEC Price Action: Shares of Orion gained 4% to close at $25.78 on Thursday.

Ferroglobe PLC GSM

• On Nov. 7, Ferroglobe posted better-than-expected third-quarter earnings. “The company continued to perform well in a difficult market environment,” commented Dr. Marco Levi, Ferroglobe’s Chief Executive Officer. The company’s stock gained around 30% over the past month and has a 52-week high is $6.24.
• RSI Value: 75.06
• GSM Price Action: Shares of Ferroglobe gained 1.7% to close at $6.11 on Thursday.

H.B. Fuller Company FUL

• On Sept. 27, H.B. Fuller posted weaker-than-expected quarterly earnings. "In the third quarter we successfully drove a double-digit increase in adjusted EBITDA year-on-year and increased adjusted EBITDA margin meaningfully, demonstrating the strength of our business model and ability to increase profitability regardless of market conditions," said Celeste Mastin, H.B. Fuller president and chief executive officer. The company’s stock jumped around 12% over the past month and has a 52-week high of $80.29.
• RSI Value: 75.80
• FUL Price Action: Shares of H.B. Fuller gained 1.7% to close at $79.11 on Thursday.

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