This market selloff has been brutal. We put some money to work between January and March, but we have since backed off our buying and now sit on about 60% cash. The valuations of many small cap stocks are simply outrageous and enticing, but the macro backdrop with inflated mega cap valuations still threatens to bring us lower. We are sitting on our hands until we get some positive data on inflation... or news of this impending recession brings the market so low that it becomes a no-brainer situation.
In the meantime, let's have some fun insulting/praising everyone's favorite teams by spreading some comps: NFL Teams as a stock... Maybe you will find a new company to investigate along the way!
*These do not represent our true views on whether you should buy, hold, or short these stock... check out our articles or message us to discuss our current favorites
NFC East
Dallas Cowboys
Stock: Haliburton (HAL)
Dallas will once again enter the season with enough talent to win a Super Bowl, but we know better than to actually bet on these perennial disappointers. Amari Cooper may be gone, but Dak is still going to put up numbers on offense, and the defense looks to be every bit as talented as it was last year. For better or worse, hopes will be high again this year.
There are plenty of "All-American" stocks that peaked in the '90s to choose from here. We'll go with Haliburton for its tied to the oil industry and Texas. As one of the largest oilfield service companies in the world, Haliburton was a great stock to own throughout the '90s. However, it has been unable to sustain any real upward momentum ever since, with big swings to the upside rejected back down to new lows. Yet, maybe this is the year Haliburton breaks out with oil prices at all time highs.
Recommendation: Hold - very tempting to buy, though!
New York Giants
Stock: International Business Machines Corporation (IBM)
The Giants are a successful franchise with one of the most unlikely Super Bowl wins ever after defeating the undefeated Patriots in 2007. However, they have been flat out awful since their last Super Bowl victory in 2011. This season doesn't look like it will be much better with yet another new head coach, an inept QB, and a star RB who is always injured.
IBM is coasting on it's past success and brand name -- simple as that. While the stock price has held up admirably during the recent selloff, forward growth rates are very uninspiring, leading us to believe the stock is overvalued. Their stock peaked around the same time as the Giants (late 2000s into early 2010s), and it does not look like the stock will get back to that level any time soon without a complete overhaul at the company.
Recommendation: Short
Washington Commanders
Stock: Activision Blizzard (ATVI)
The Washington Commanders can change their name all they want - it still can't hide the fact that the franchise had been underwhelming for decades. To make matters worse, Dan Snyder, owner of the team, has been mired in scandal after scandal over the past few years, leading to numerous lawsuits, employee walkouts, and franchise turmoil. It now appears that the only way out for Snyder is via a sale
Any stock with ongoing scandals and underwhelming performance qualifies here. We'll go with Activision Blizzard simply based on similarities around leadership from the top, although the company's stock performance has been much better than the performance of Washington's over the past decade. After a nasty harassment scandal involving the CEO caused employees to walk out and the stock price to plummet, Activision finally found a way out through a sale to Microsoft. Premier assets will always have a strong market, so its likely Washington would not have a hard time finding a buyer either (don't get your hopes up, Washington fans).
Recommendation: Hold - even though we want to short
Philadelphia Eagles
Stock: Zillow (Z)
The Eagles have a lot of potential with this roster that has been reconstructed after its Super Bowl run, but there is still one big question mark -- QB. Jalen Hurts has shown glimpses of dual-threat ability, but his inconsistency throwing the football still leaves much to be desired. AJ Brown and a solid o-line will help the young QB, but he still needs to take the next leap for the Eagles to truly become contenders.
Zillow as a platform absolutely dominates the real estate market, but the financial performance of the company leaves much to be desired. They recently blew up their "savior" I-buying model (Carson Wentz trade), and the company is now looking for direction around further monetization of its platform. The company pitch of Zillow 2.0 is tempting, as they do have many revenue levers to pull thanks to their successful platform, but management has yet to prove it's capable of following through on these promises.
Recommendation: Hold - add to your watchlist
NFC North
Chicago Bears
Stock: Spire Global (SPIR)
The double doink that broke the franchise's back... There was a lot of potential here when the Bears defense was rolling, but the team has chosen to move into the Justin Fields-era with a new head coach. Not much is expected of the Bears this season -- the offensive pieces around Fields are shaky at best, while the defense may(?) be pretty good.
Much like the Bears, not too much is expected of Spire Global right now. It's "space-as-a-service" offering may change the world one day (Fields for MVP), but it could also wind up being a massive flop (trading up for Trubisky). With the stock already beaten down this far, the downside risk is not nearly as great as it was before, making it a potential buy low candidate if the technology gains more traction over the coming years.
Recommendation: Hold - add to watchlist, but don't hold your breath
Green Bay Packers
Stock: Meta Platforms - formerly Facebook (META)
As long as Aaron Rodgers plays for the Packers, the team will be a contender. That said, the team took a step back after trading top target, Davante Adams, to the Raiders this offseason. It will be up to Aaron Rodgers to lift his unproven receiving corps this year, while the defensive side of the ball looks to be every bit as dynamic as it was in years prior.
It's been a disastrous start to the year for Meta Platforms with the market questioning the company's ability to follow through on its expansion into the metaverse and leave the Facebook name behind. There are challengers all around, ranging from Tik Tok to Snap to Google, but it's hard to bet against a proven winner when the valuation has been knocked down this far. Time will tell if Zuckerberg was correct in this pivot to the metaverse, but it's tough to bet against Meta Platforms all the way down here.
Recommendation: Buy - but be ready to cut bait if recent moves fail to pay off
Detroit Lions
Stock: Carnival Corporation (CCL)
One of the feel-good stories of last season, Detroit ended its season on a high-note under lovable new coach Dan Campbell. Did the team overachieve at the end of the season or will a strong draft class help propel the team back into relevancy in the NFL? There's plenty to like about the Lion's offense outside of QB, but the defense and Jared Goff still leave much to be desired.
Carnival seemed like a no-brainer reopening play after a nice pop last year with cruise ships finally getting up and running again and pent-up demand amongst travelers from cruises. The reality of the situation, though, is that there are still numerous structural issues within the company. Fuel costs have doubled, discounts have been needed to stoke demand, and overall yields per passenger have plummeted recently. This is very bad for a company that had to take on massive amounts of expensive debt to stay alive during COVID.
Recommendation: Short - the hype went too far too fast
Minnesota Vikings
Stock: Boeing (BA)
This team is pretty boring with Kirk Cousins at QB. While the WR duo of Jefferson and Thielen is fun to watch, Dalvin Cook is a stud at RB, and the defense has shown glimpses in the past, the team always ends up disappointing in the end. It's hard to see much changing this year, but maybe the replacement of defensive-minded Mike Zimmer as head coach will be enough to allow the Vikings to break through this year.
Boeing is a consistently decent company with occasional periods of outperformance followed by stretches of mediocrity, and sometimes outright failure/disappointment (see 737 Max). In order to break out of this rut, David Calhoun was hired in 2020. With an extensive background in private equity, including as head of portfolio operations at the prestigious Blackstone Group, there is a belief that the change in leadership will unlock the vast potential of this company over the coming years.
Recommendation: Hold - buy if price drops much further
NFC West
Los Angeles Rams
Stock: Alphabet (GOOG)
The rich keep getting richer. With a seemingly endless budget, the Rams are primed to compete for the Super Bowl again this year. The team is built on smart acquisitions in the free agency market that plug right into their core group. As long as Sean McVay and Aaron Donald are on this team, the franchise appears to have one of the highest floors in the NFL.
Google is one of the most valuable companies in the world, and it still may be undervalued in the current environment. While the market may have believed Google was overpaying for assets like Youtube at the time, those deals have since proven to be genius moves by management. One of Google's most famous acquisitions came when it bought Motorola in 2012 for $12.5bn in order to build out its Android phone operating system. Two years later, they sold the company right back to Lenovo for $3bn and called it a massive success. Google simply wanted Motorola's patents - Google is not afraid to think outside the lines, even as a mega cap.
Recommendation: Buy - be careful about overpaying
Seattle Seahawks
Stock: General Electric (GE)
How the mighty have fallen. There's no more Legion of Boom, there's no more Beast Mode, and now there is no more Russell Wilson -- the end of a special era. All good things must come to an end, and the Seahawks have finally decided to blow it up and start over. It's never a good thing when you are deciding between Drew Lock and Geno Smith as your opening day starter. It's almost a given that this team will be tanking this year in hopes of snagging CJ Stroud or Bryce Young as their QB of the future in next year's draft.
GE was on top of the world way back when. A global conglomerate with cutting-edge technology, diversification, talent, and pricing power. Now it's more of a zombie company, spinning off assets and milking profitable legacy businesses while it still can. Yes, there's the possibility that the aviation division could lift the company's stock price in the coming years, but the company failed to continue innovating when it was atop the stock market, and it has likely now fallen too far behind to ever catch up before being sold off piece by piece... not to say that the Seahawks are forever doomed to this fate, despite their current dire QB situation.
Recommendation: Short
Arizona Cardinals
Stock: The Trade Desk (TTD)
Another hot start, another disappointing end to the season for Kyler Murray and the Arizona Cardinals. Between Kyler, JJ Watt, Deandre Hopkins, Aj Green, Zach Ertz, James Conner and Budda Baker, talent is not the issue. For some reason, in back to back years, the team has simply failed to follow through on promising starts to the season. People are now starting to lose faith in this once-promising team, and this will likely be a pivotal year in determining the future of this franchise and its current roster.
The Trade Desk is without a doubt one of the most exciting, yet hard to evaluate, companies in the market. On one hand, it has some of the most promising tech in a rapidly expanding market that the economy relies upon (advertising). However, it is constantly trading at valuations well beyond its peers, despite performance that is actually much closer to those peers than fans and management would have you to believe. The promise of the company continues to keep the price elevated, but recent slowdowns and perceived underperformance have still dragged the stock down significantly over the past year. Some will say it's the perfect time to buy low on this promising, young company, while others will say the stock is still coming back to reality with more room to fall.
Recommendation: Hold - buy if the price falls too much lower
San Francisco 49ers
Stock: Chipotle (CMG)
Never count this team out. Even when it seems like the roster lacks the talent to compete, the 49ers are still able to make deep runs in the playoffs and wreak havoc throughout the league. This current version of the 49ers is built on solid d-line play and the offensive genius of head coach Mike Shanahan. Despite a lack of talent at QB, the 49ers will once again be a major contender for the Super Bowl... and, if Trey Lance does end up panning out, then watch out, because everything else is in place for a real Super Bowl run this year.
No way this stock can keep going up has been said numerous times about Chipotle, yet the share price continues to climb, even in the face of uncertainty. Rather than resting on their laurels, Chipotle continues to swing for the fences with innovative menu additions, technology advancements, and outside the box thinking (replacing a highly competent Jimmy G with Trey Lance?). Years of outperformance relative to expectations have led to higher expectations in the coming years, though. One stumble, and the elevated valuation could quickly come back down to Earth. Yes, there is loads of potential still left here, but it now comes at a much steeper price that may leave some feeling uneasy.
Recommendation: Hold - too expensive given current expectations relative to current situation
NFC South
Carolina Panthers
Stock: Under Armour (UAA)
While my Panthers may be run by one of the greatest investors of all time in David Tepper (Appaloosa), the team has fallen on rough times without a QB, nor a head coach who inspires much confidence. It reminds me of a company with great institutional backing but poor leadership within the company itself.
Under Armour was once a Wall Street darling, especially when the Panthers were making their run around 2015 with Under Armour athlete Cam Newton as their MVP QB. However, it has been nothing but pain for both parties since this time. The Panthers have not been relevant since and UAA has plummeted ever since its peak in the mid-2010s with its star-studded roster of athletes across multiple sports.
Recommendation: Short
Atlanta Falcons
Stock: Pinterest (PINS)
Having dumped franchise stalwart Matt Ryan this offseason, the Falcons are embarking on a new journey under Art Smith (son of FedEx founder, Fred Smith). As long as Matt Ryan was there, the Falcons were nothing more than "28-3". This recent pivot makes sense, and it will be interesting to see how it plays out.
Pinterest is also transitioning at the top this year, having named Google's president of commerce, Bill Ready, the new CEO. With a background in payments from his days at PayPal and Venmo, Bill is clearly being brought in to move Pinterest's social media platform to the forefront of e-commerce. Will this move prove to be successful? Time will tell... the same goes for Atlanta and its decision to move on from Matty Ice.
Recommendation: Hold - let's see how this plays out first
New Orleans Saints
Stock: Exelixis (EXEL)
Gone are the days of the Saints outscoring everyone in the NFL with Drew Brees and Sean Payton leading the charge. This team is now built on defense, and the hiring of their DC, Dennis Allen, serves to further solidify this new era. However, there is still some explosive upside on the offensive side this year if the pieces come together and Jameis and Michael Thomas get healthy.
Healthcare stocks are often defensive in nature. While the broader markets have sold off in 2022, Exelixis is up 12.7%. However, there is still some significant upside left in this defensive pharmaceutical stock depending on expansion of its successful Cabozantinib drug and any positive news related to other drugs in their pipeline.
Recommendation: Buy - fairly safe play during this selloff
Tampa Bay Buccaneers
Stock: Microsoft (MSFT)
Tampa's entire season turned around once Tom Brady announced he was coming back from retirement. They will immediately go back to being a Super Bowl favorite on the back of their prolific offense and solid defense. It's really hard to find many holes in this team, even with HC Bruce Arians retiring during the offseason.
The Bucs franchise may not be at the level of Microsoft, but Tom Brady sure is. Year after year, even when it seems further growth is not possible, the two continue to surprise to the upside. Even at a rich valuation during a selloff that has punished other tech companies, MSFT has earned the benefit of the doubt through decades of outperformance.
Recommendation: Buy - don't bet against Brady or MSFT