LITE, CRWV, NBIS, AMAT, SMCI Were Among Last Week’s Biggest AI-Linked Losers: Which Stocks Are Flashing Oversold Signals?

• CoreWeave and Applied Materials recorded RSI readings below 30, according to Koyfin.
• Super Micro Computer trades at 7.3 times forward earnings, below Applied Materials at 23.2 times and Lumentum at 37.8 times.
• Retail sentiment toward CoreWeave and Nebius turned ‘extremely bullish’ on Stocktwits as both stocks rebounded in Monday’s premarket session.

Several AI-linked stocks sold off sharply last week, with Lumentum Holdings (LITE), CoreWeave (CRWV), and Nebius Group (NBIS) losing more than a quarter of their value. Consequently, investors are looking to pick up stocks that offer a good bargain. 

Falling prices of CoreWeave’s bonds, a hotter-than-expected inflation reading, and fresh concerns about the durability of AI investment hammered tech stocks – particularly semiconductor equities – last week. The iShares Semiconductor ETF (SOXX) declined 11.8%, its worst weekly fall since March.

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According to Koyfin data, CoreWeave and Applied Materials are in the “oversold” territory in the group, with their relative strength index (RSI), a gauge of a stock’s price momentum, falling below 30.

An RSI reading below 30 generally indicates oversold conditions, and readings above 70 suggest overbought conditions. Nebius had an RSI reading on 30.63, Super Micro Computer (SMCI) had a reading of 30.19 and Lumentum had a reading of 37.37.

SMCI Offers Low P/E Multiple

In terms of the price-to-earnings, SMCI is still the most attractive bet. Its shares are currently priced at 7.3 times future earnings, compared with 23.2 times for Applied Materials and 37.8 times for Lumentum. Nebius and CoreWeave are loss-making.

The market rose in Monday’s premarket session after a brutal week for tech stocks as investors set their positions for the key phase of the third-quarter earnings season. 

Netflix (NFLX), Meta Platforms (META), International Business Machines (IBM), and Western Digital (WDC) will report their quarterly results this week, setting the tone for the tech trade.

LITE, CRWV: Premarket Move, Retail View

The premarket gains were led by chip stocks, with Intel rising over 4% and Micron and Advanced Micro Devices (AMD) gaining about 2.7% each. LITE and NBIS gained about 3.8% each, leading the rally in the aforementioned group. 

On Stocktwits, the retail sentiment for CRWV and NBIS climbed higher over the past week and was ‘extremely bullish’ on Monday. The sentiment for AMAT was ‘bullish’ for LITE and AMAT, and ‘neutral’ for SMCI.

“$CRWV this will be over 100 in the coming weeks, loading up time is now,” a trader wrote.  

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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