Despite investor concerns surrounding the rapid spread of the COVID-19 Delta variant, the major stock market indexes are hovering around all-time highs, due primarily to impressive corporate earnings. But Etsy (NASDAQ:ETSY), Fiverr (FVRR), and Fastly (NYSE:FSLY) reported disappointing second-quarter earnings reports last week. So, we think it is best to avoid these stocks now. Read on.Even though more people are getting vaccinated, the rapid spread of the highly contagious COVID-19 Delta variant is worrying investors. Consequently, several countries are re-imposing restrictions to curb the virus’ spread. For example, China imposed strict international travel restrictions on August 4 after reporting its highest daily number of COVID-19 infections in the past few months. Also, the United States’ CDC revised its mask guidance last month.
Nevertheless, the major stock market indexes are hovering around all-time highs thanks to strong corporate earnings. According to a Factset report, more S&P 500 companies beat EPS estimates for the second quarter than the historical average and they also beat EPS estimates by a wider margin than on average.
However, not every company reported impressive earnings results. Etsy, Inc. (ETSY), Fiverr International Ltd . (NYSE:FVRR), and Fastly, Inc. (FSLY) reported disappointing second-quarter results last week, and their shares declined as a result. So, we think it’s best to avoid these three stocks now.