Marketdash
Back to News

Three Oversold Communication Stocks Worth Watching This December

MarketDash Editorial Team
17 hours ago
When stocks in the communication services sector get hammered hard enough, they might present bargain opportunities for contrarian investors. Here are three names with RSI readings near or below 30, suggesting they're technically oversold and potentially primed for a bounce.

Sometimes the most interesting investment opportunities hide in the wreckage. When stocks get beaten down hard enough, they can transition from "falling knife" territory into "potential bargain" status. That's the theory behind hunting for oversold stocks, anyway.

The communication services sector has served up three particularly battered names that might be worth a closer look. These companies have RSI readings hovering near or below 30, which in technical analysis land typically signals oversold conditions. For those unfamiliar, the Relative Strength Index is a momentum indicator that compares a stock's performance on up days versus down days. When the RSI drops below 30, it suggests the selling might have gotten overdone, potentially setting up a rebound.

Of course, stocks can be oversold for good reasons. But for traders with a contrarian streak, these situations can offer interesting entry points. Here's what's happening with three names flashing oversold signals right now.

Gogo Inc. (GOGO)

The in-flight connectivity provider took a beating after William Blair analyst Louie DiPalma downgraded the stock from Outperform to Market Perform on December 9. The shares tumbled around 19% over a five-day stretch, eventually hitting a 52-week low of $5.20 before catching a small bounce.

RSI Value: 26.4

GOGO Price Action: Shares of Gogo gained 2.8% to close at $5.61 on Wednesday.

Edge Stock Ratings show a momentum score of 8.82 with value at 15.91, suggesting the technical picture has weakened considerably even as the valuation potentially becomes more attractive.

Zhihu Inc. (ZH)

This Chinese question-and-answer platform reported year-over-year declines in its third-quarter results on November 25. Chairman and CEO Yuan Zhou tried to strike an optimistic tone, noting that "We are firmly on track to achieve full-year non-GAAP breakeven, with solid progress made during the quarter." The market wasn't particularly impressed, though. The stock dropped roughly 20% over the past month and recently touched a 52-week low of $3.19.

RSI Value: 25.6

ZH Price Action: Shares of Zhihu fell 1.6% to close at $3.39 on Wednesday.

The company is making progress toward profitability on a non-GAAP basis, but investors seem focused on the top-line challenges rather than the cost-cutting achievements.

Brera Holdings PLC (SLMT)

Brera Holdings, trading under the ticker SLMT (formerly Solmate), has had a brutal month. The stock collapsed around 67% over the past 30 days, hitting a 52-week low of $1.80. The decline accelerated after the company signed a non-binding term sheet on December 4 for an all-stock business combination with RockawayX. Apparently, investors weren't thrilled about the proposed deal terms or direction.

RSI Value: 24.2

SLMT Price Action: Shares of Brera Holdings fell 4.3% to close at $2.43 on Wednesday.

With an RSI reading this low, the stock is technically screaming "oversold," though whether that translates into a bounce or just marks a pause in a longer decline remains to be seen.

The Bottom Line on Oversold Stocks

An oversold reading doesn't guarantee a bounce. Stocks can remain oversold for extended periods, especially if fundamental problems persist. But for traders looking to time an entry or investors hunting for potential contrarian plays, these RSI levels at least put these names on the radar. The key is distinguishing between stocks that are oversold because they're value traps versus those that have simply been caught up in temporary selling pressure.

Each of these three communication services names has its own story. Gogo faces analyst skepticism. Zhihu is navigating a challenging revenue environment while trying to reach profitability. Brera Holdings is dealing with uncertainty around its proposed business combination. Whether any of them bounce from these oversold levels depends on whether the underlying catalysts improve or deteriorate from here.

Back to News

Three Oversold Communication Stocks Worth Watching This December

MarketDash Editorial Team
17 hours ago
When stocks in the communication services sector get hammered hard enough, they might present bargain opportunities for contrarian investors. Here are three names with RSI readings near or below 30, suggesting they're technically oversold and potentially primed for a bounce.

Sometimes the most interesting investment opportunities hide in the wreckage. When stocks get beaten down hard enough, they can transition from "falling knife" territory into "potential bargain" status. That's the theory behind hunting for oversold stocks, anyway.

The communication services sector has served up three particularly battered names that might be worth a closer look. These companies have RSI readings hovering near or below 30, which in technical analysis land typically signals oversold conditions. For those unfamiliar, the Relative Strength Index is a momentum indicator that compares a stock's performance on up days versus down days. When the RSI drops below 30, it suggests the selling might have gotten overdone, potentially setting up a rebound.

Of course, stocks can be oversold for good reasons. But for traders with a contrarian streak, these situations can offer interesting entry points. Here's what's happening with three names flashing oversold signals right now.

Gogo Inc. (GOGO)

The in-flight connectivity provider took a beating after William Blair analyst Louie DiPalma downgraded the stock from Outperform to Market Perform on December 9. The shares tumbled around 19% over a five-day stretch, eventually hitting a 52-week low of $5.20 before catching a small bounce.

RSI Value: 26.4

GOGO Price Action: Shares of Gogo gained 2.8% to close at $5.61 on Wednesday.

Edge Stock Ratings show a momentum score of 8.82 with value at 15.91, suggesting the technical picture has weakened considerably even as the valuation potentially becomes more attractive.

Zhihu Inc. (ZH)

This Chinese question-and-answer platform reported year-over-year declines in its third-quarter results on November 25. Chairman and CEO Yuan Zhou tried to strike an optimistic tone, noting that "We are firmly on track to achieve full-year non-GAAP breakeven, with solid progress made during the quarter." The market wasn't particularly impressed, though. The stock dropped roughly 20% over the past month and recently touched a 52-week low of $3.19.

RSI Value: 25.6

ZH Price Action: Shares of Zhihu fell 1.6% to close at $3.39 on Wednesday.

The company is making progress toward profitability on a non-GAAP basis, but investors seem focused on the top-line challenges rather than the cost-cutting achievements.

Brera Holdings PLC (SLMT)

Brera Holdings, trading under the ticker SLMT (formerly Solmate), has had a brutal month. The stock collapsed around 67% over the past 30 days, hitting a 52-week low of $1.80. The decline accelerated after the company signed a non-binding term sheet on December 4 for an all-stock business combination with RockawayX. Apparently, investors weren't thrilled about the proposed deal terms or direction.

RSI Value: 24.2

SLMT Price Action: Shares of Brera Holdings fell 4.3% to close at $2.43 on Wednesday.

With an RSI reading this low, the stock is technically screaming "oversold," though whether that translates into a bounce or just marks a pause in a longer decline remains to be seen.

The Bottom Line on Oversold Stocks

An oversold reading doesn't guarantee a bounce. Stocks can remain oversold for extended periods, especially if fundamental problems persist. But for traders looking to time an entry or investors hunting for potential contrarian plays, these RSI levels at least put these names on the radar. The key is distinguishing between stocks that are oversold because they're value traps versus those that have simply been caught up in temporary selling pressure.

Each of these three communication services names has its own story. Gogo faces analyst skepticism. Zhihu is navigating a challenging revenue environment while trying to reach profitability. Brera Holdings is dealing with uncertainty around its proposed business combination. Whether any of them bounce from these oversold levels depends on whether the underlying catalysts improve or deteriorate from here.