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1 Stock To Buy, 1 To Dump When Markets Open: Novavax, American Airlines

By Investing.com (Jesse Cohen/Investing.com)Stock MarketsNov 28, 2021 07:32AM ET
www.investing.com/analysis/1-stock-to-buy-1-to-dump-when-markets-open-novavax-american-airlines-200609737
1 Stock To Buy, 1 To Dump When Markets Open: Novavax, American Airlines
By Investing.com (Jesse Cohen/Investing.com)   |  Nov 28, 2021 07:32AM ET
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Stocks on Wall Street sold off on Friday, during the shortened, post-Thanksgiving session. The benchmark S&P 500 index suffered one of its biggest losses of the year as fears over a new coronavirus variant spooked the market.

The World Health Organization dubbed the heavily mutated B.1.1529 COVID variant, which was first detected in South Africa, as a "variant of concern," the first such designation since the Delta variant a year ago. While it is still unclear if the new mutation, named ‘Omicron,’ is more deadly than prior strains, scientists and health officials are worried it could be more transmissible.

SPX Daily Chart
SPX Daily Chart

The week ahead is expected to be another eventful one, as investors monitor further developments on the lingering health crisis and key Congressional testimony from Federal Reserve Chair Jerome Powell is on the docket. We'll also see important economic data, such as the latest U.S. employment report, and earnings from companies like Salesforce (NYSE:CRM), Crowdstrike (NASDAQ:CRWD), and DocuSign (NASDAQ:DOCU) come through.

Regardless of which direction the market goes, below we highlight one stock likely to be in demand in the coming days and another which could see fresh losses.

Remember though, our timeframe is just for the week ahead.

Stock To Buy: Novavax

COVID-related developments are expected to dominate market sentiment in the week ahead amid mounting fears about the new Omicron coronavirus variant. That should result in increased buying activity for Novavax (NASDAQ:NVAX), which said that it has already started working on a version of its original COVID-19 vaccine designed to target the recently discovered variant.

The vaccine developer said it would have the new shot ready for testing and manufacturing in the next few weeks.

NVAX Daily Chart
NVAX Daily Chart

NVAX stock, which started the year at $111.51 and soared all the way to an all-time peak of $331.00 in early February, ended Friday’s session at $217.97, its best level since Sept. 28. At current levels, the Gaithersburg, Maryland-based biotechnology firm has a market cap of roughly $16.5 billion.

Novavax has thrived this year amid bullish bets its coronavirus vaccine will materialize into a major revenue source in the years ahead. Year-to-date, shares have gained 95.5%, easily outpacing the S&P 500’s 22.3% increase over the same timeframe.

The vaccine maker, which received its first emergency use approval (EUA) earlier this month in Indonesia, has stated it is on track to file for EUA in the U.S. by the end of 2021. It has also filed for approvals with the European Medicines Agency as well as in Canada.

Through its recombinant nanoparticle vaccine technology, it produces vaccine candidates to respond to both known and newly emerging diseases.

Stock To Dump: American Airlines

With fears brewing over another potential wave of the coronavirus—and subsequent global restrictions and lockdowns to slow the spread of the disease—shares of American Airlines (NASDAQ:AAL) are expected to suffer another miserable week.

Health officials in Australia's most populous state, New South Wales, said two passengers who arrived in Sydney from southern Africa on Saturday evening had tested positive for the Omicron variant of the coronavirus.

The Australian cases were the latest indication that the Omicron variant, which has also been detected in the U.K., Germany, Italy, Belgium, Austria, Israel, Hong Kong, and Botswana, is spreading around the world.

As the prevalence of infection grows, some authorities have begun to reimpose restrictions on travel from countries in southern Africa. The U.S., U.K., European Union, Australia, Israel, and Singapore have already suspended flights from the region.

That could result in more negative action for American, which flies to 126 international destinations in 64 different countries.

AAL Daily Chart
AAL Daily Chart

AAL stock closed at a more than nine-month low of $17.75 on Friday, earning the Fort Worth, Texas-based carrier a market cap of $11.5 billion.

It now stands roughly 32% below its post-pandemic high of $26.09 reached on Mar. 18, highlighting the airliner’s ongoing struggles amid the sharp decline in air travel during the coronavirus pandemic.

At current valuations, American Airlines is the fourth-largest U.S. airline company behind Southwest Airlines (NYSE:LUV), Delta Air Lines (NYSE:DAL), and United Airlines (NASDAQ:UAL).

1 Stock To Buy, 1 To Dump When Markets Open: Novavax, American Airlines
 

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1 Stock To Buy, 1 To Dump When Markets Open: Novavax, American Airlines

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Comments (15)
ZS Beck
ZS Beck Dec 01, 2021 8:58AM ET
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Great advice.Buy airlines and hold it. They are beaten downNovavax is a horrible idea unless you like risk. There are more vaccines out than needed and they are pills coming.
Woody Kaleepop
Woody Kaleepop Nov 29, 2021 2:34PM ET
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im going to buy put NVAX
tayyab shah
tayyab shah Nov 29, 2021 2:34PM ET
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I buy after this news and guess what happendIts just dropped 10%
Mohd Izhar Muslim
Mohd Izhar Muslim Nov 29, 2021 7:34AM ET
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Greatest once
Never Try
Never Try Nov 29, 2021 3:17AM ET
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Omicron variant only shows mild symptoms in unvaccinated people and no symptoms in vaccinated people. I'll take that over Delta variant any day...
Gregory Me
Gregory Me Nov 29, 2021 1:53AM ET
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Liberalism and lockdowns....
Peter Sookoo
Peter Sookoo Nov 28, 2021 9:44PM ET
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I am interested
Jason Lebron
Jason Lebron Nov 28, 2021 7:11PM ET
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Good article. MRNA, BNTX & NVAX short-term & Airlines Long-term.
Leon Kelly
Leon Kelly Nov 28, 2021 5:00PM ET
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I just came for the roast🍿
ZS Beck
ZS Beck Nov 28, 2021 2:39PM ET
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Novavax is a no-need vaccine. Nobody using it...You buy airlines in the panic, they are beaten down already. All this fear just created for nothing.Just read the South African medical association about the new variant. Nobody even had to go to the hospital for treatment. The symptoms are mild. All these things just create fear for people to take the vaccine.
Ama Tobo
Ama Tobo Nov 28, 2021 11:42AM ET
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next few weeks the vaccine ready? Nice!
Steve Lin
Steve Lin Nov 28, 2021 11:19AM ET
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So you mean nobody travel by air lines from now on?
Kavita Jain
Kavita Jain Nov 28, 2021 11:19AM ET
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Buy something that has better alternatives like pfizer and sell something during the peak time and when TSA is saying it has reached 91% of pre pandemic numbers.
STEPHEN DEWIT
STEPHEN DEWIT Nov 28, 2021 11:19AM ET
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So far looks like the retail and tech sectors are strong, for the short term, maybe…see you in AZ!!!
Chopin Liszt
Chopin Liszt Nov 28, 2021 11:18AM ET
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aal will get destroyed once interest rate is up. but i bought zoom at 200 and saying sell zoom in wrong.
John Brown
John Brown Nov 28, 2021 11:15AM ET
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Cogn should have an excellent week...!!!
mulei mbithi
mulei mbithi Nov 28, 2021 11:12AM ET
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nasdaq will buy during market open .then sell market structure must  be respected
Dominika Gallová
Dominika Gallová Nov 28, 2021 7:53AM ET
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I agree absolutely, NVAX is BUY a stronh BUY now and AAL who owns it I reccomend to sell it rigjt now.
Mike Kellner
Mike Kellner Nov 28, 2021 7:53AM ET
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New Covid variant is totally overplayed. I will buy airline and cruise ship stocks first thing in the morning
tayyab shah
tayyab shah Nov 28, 2021 7:53AM ET
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i wanna ask which platfoam you use to buy stock?
 
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