These stocks on Josh Brown's list got washed out in last week's sell-off. Where to go from here
(This is The Best Stocks in the Market , brought to you by Josh Brown and Sean Russo of Ritholtz Wealth Management.) Josh — Last week was one of the wildest market moments we’ve seen in a long, long time. The post-election exhale on Wednesday (“He’s not going to contest the results and incite a riot! Hooray!”) sent the Dow Jones Industrial Average skyrocketing 1,569 points, the biggest post-midterm gain since 1982. And then the rethink on Thursday, with the AI-heavy Nasdaq crashing 5.5%, represented one of the most volatile one-day sentiment shifts we’ve ever seen. Semiconductors finally took out the sector’s 200-day moving average after languishing below the June highs for months while their CEOs forecast record profits for years to come. Investors have been compressing the multiples on chip stocks regardless of the guidance and this week they just spat them out. Oh, and we’re bracing for Anthropic’s potentially destabilizing IPO, which still seems likely to make its debut at over a trillion dollars. And, as a cherry on top, we’re in the middle of earnings season too, with reports dropping like water balloons from the fifth floor window of a fraternity house. Everything is happening all at once and no one knows what to do. Are you not entertained? Today, Sean and I are going to take a look at some of the washouts from among our recent write-ups. These are technology stocks that were in strong uptrends when we wrote about them here in this column. In the weeks since, those uptrends have reversed and most of these stocks have dropped (or are in danger of dropping) off of our list. In markets like these, investors and traders relearn the value of using stops with discipline. The stop loss, in a corrective market, accomplishes three things: Keeps losses manageable and prevents you from “getting married” to a ticker symbol you bought in a different market phase. Creates a tax loss which can be applied against your gains. Frees up dry powder for other opportunities, keeps you nimble and liquid to take advantage of the chaos rather than being a victim of it. Nobody likes buying a stock and being stopped out a week or a month later with a five to twenty percent loss. But you know what’s worse? Sitting on a 40% loss that you can never bring yourself to take with the uncertainty of whether the stock in question will see the price you bought it at ever again. I promise you the latter feels (and is) worse. Which is why we never deliver a column here without risk management levels for both traders and investors to consider prior to entering. Today, we’ll show you two names that have traded through these risk management levels in a market with no mercy for anything related to the data center theme. And then a third name that is hanging by a thread. Someone once told me that nobody really learns anything from their successes, only from their failures. In the Best Stocks in the Market column, we don’t run and hide from the trades that didn’t work out. We use them as teachable moments for our readers and ourselves. Here’s Sean with the usual high-level stats and charts first… As of Nov. 9, there are 167 names on The Best Stocks in the Market list. Top sector ranking: Top industries: Top 5 best stocks by relative strength: Spotlight: Best stocks – washout edition Palantir Technologies, Inc. (PLTR) Sean — We spotlighted Palantir on Oct. 15 , when Josh compared it to the fastest roller coaster in the world, citing a 1.6 beta and an 85% five-year max drawdown. Well, we’re getting what we wrote about with the roller coaster metaphor. PLTR closed at $200.97 the day before our column and is down 20% since, closing Friday at $160.38. We gave traders $185 as the stop (a daily close below) and investors $166 (a weekly close below). PLTR first closed below $185 on October 30 and is on pace for a weekly close below $160. It’s 14% below its 50-day ($186.39) and 4.4% above its 200-day ($153.56), with RSI at 25. It closed Thursday at $154.99, less than 1% above the 200-day, nearing a level where we’ll remove this name from our list. You know that discombobulated feeling after an amusement ride? This feels similar! Earnings weren’t the problem with this stock. We said Q3 guidance implied 83% growth, and Palantir reported November 2 with revenue of $2.31B, up 96%. PLTR raised full-year revenue guidance to $8.53B from $8.15B, net dollar retention rose to 165% from 157%, and U.S. commercial passed U.S. government for the first time. The problem is the multiple on earnings and whether investors want to pay up for the growth or wait for a lower price. Risk management: Josh — As Sean pointed out, the rollercoaster did what rollercoasters do. We were pretty explicit that this ride would not be for everyone. Three weeks later and the entire technical picture we had written about is out the window. Both of our stops have been hit. The $185 level for traders broke on the Oct. 30 close at $184, and the $166 level for investors broke on Friday’s weekly close at $160. The stock is now a true washout. It fell 28% from its Oct. 12 high to Thursday’s low, and RSI went from 76 on Oct. 9 to 25 on Thursday, 50 points of momentum gone in under four weeks. With RSI having dipped below 30, if you haven’t sold it yet, now probably isn’t the best time to do so. I expect a bounce. PLTR found support precisely at its 200-day moving average this week. It traded down to $153 on Thursday and closed at $155, with the 200-day at $154. The Aug. 6 low came in at the same $153, which is another reason a bounce would make sense here. I’m not saying you can’t make money with a new long position here. You might, but that’s just not within the purview of this column. We want to own the Best Stocks and react quickly when they break down, which happens in a market-wide crash. Okta, Inc. (OKTA): Sean — We spotlighted Okta on Oct. 29 as cyber sold off on Fortinet’s report, with the stock at $222.66 the night before. Josh’s line was $190, the rising 50-day, with the Oct. 16 and 20 lows of $185 and $184 just underneath. We gave traders a daily close below $190 and investors a weekly close, and said a breach of those levels takes us out. It’s down 24% since writing, and 28% below its $235 high, the breakout level Josh flagged. It’s 14% below its 50-day ($196.89) and 34% above its 200-day ($126.40), with RSI at 36. Okta joined the S & P 500 on November 4, replacing Kenvue, and it’s down 11% since the last close before SPX inclusion. We wrote that earnings beats alone weren’t enough this reporting season and that the bar was high after a 36% run since its last report. The stock has since given back nearly all of its gains since. At $168.72, it’s about 3% above the roughly $163 where it traded going into that great earnings report. At the midpoint of its $3.90 to $3.94 FY27 non-GAAP EPS guide, that’s about 43x earnings, versus the 57x we quoted at $222. Okta reports Q3 earnings again on December 1, guiding to $813M to $817M of revenue and $0.92 to $0.94 of EPS. Risk management: Josh — We were wrong on this stock and we found out fast. It closed at $208 on Oct. 30, then fell 11% on Nov. 2 to close at $185, below our $190 risk level. Anyone who respected the level was out at $185 instead of riding it to Friday’s close at $169, another 9% lower. Respecting the $190 risk level we wrote about was the key to survival on this one. Hewlett Packard Enterprise Co. (HPE): Sean — We wrote up HPE on Sept. 29, 2025, in the “boxmakers” column with IBM, Dell and Cisco. HPE closed at $24.00 the Friday before and is up 87% since, at $44.76. This was a big winner, but in 2026 it’s a “what have you done for me lately” market. HPE is down 39% from its October high of $73.56 and down 35% in a month. Josh set $22 for traders (the 50-day then) and $20 for investors (the top of the June gap), and said not to risk more than 10%. Traders were stopped out on Nov. 17, 2025 at $21.23, down 11.5%. The stock never closed below $20, with a low close of $20.00 on February 23, 2026, and then price more than tripled to the October high. HPE is now 25% below its 50-day ($59.39) and 8% above its 200-day ($41.35), with RSI at 31. Both old stops are far below, so we are very much in need of an updated risk limit. In terms of narrative, we framed HPE as a direct way to play the datacenter buildout. That’s still the story. HPE reported September 2 with record revenue of $12.2B (up 34%) and non-GAAP EPS of $1.11 (up 152%), with Cloud & AI up 25% and networking up 75% year over year. HPE raised full-year EPS guidance to $3.75 to $3.85 and flagged memory supply constraints into 2027. The AI trade has been wobbling, but the sell-off accelerated last Thursday, two days after the midterms. The market had priced in a Democrat win, but not this big of a win. It sent a number of AI darlings down. Over Wednesday and Thursday together, Dell fell 22%, HPE 17% and Super Micro fell 14%. Similar to PLTR and OKTA, this stock is in jeopardy of being removed from our list. Risk management: Josh — This trade is still alive from September 2025, but the risk levels we had originally written about have long since become irrelevant as the stock price has risen dramatically. I would assume plenty of people who bought it in the 20’s have taken the stock off at some point at much higher levels. We leave the profit-taking to the readers’ discretion and never comment on when to sell. That’s going to be a different answer for everyone. A valuation-oriented investor may be excited to snap some HPE shares up while it’s in such a big drawdown from its recent highs. If they’re at all interested in the technicals, I’ll say two constructive things: it’s still above the 200-day, which is rising at $41, and momentum has now completely reset at a 31 RSI. This is not for us, in the context of what we do here, but I don’t hate it either. DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, or its parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. 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