In the first quarter, the worst-performing stocks covered by Morningstar analysts stumbled under the weight of supply chain constraints, inflation and consumers reallocating cash to other areas, according to Jaime Katz, a senior equity analyst.
“Consumers may be spending more on staples than discretionary,” Katz said in a recent Morningstar blog post.
Morningstar ranks stocks based mainly on valuations. It assigns Morningstar ratings to stocks, from 1 star, which denotes most expensive, to 5 stars, the most undervalued.
Analysts found that of the 863 stocks they cover, about half experienced at least a one-star change in its rating. Fifty-five stocks became overvalued in the January-to-March period and 114 became undervalued.
See the gallery for the 15 worst-performing stocks in the first quarter.