10 Worst Cruise Stocks to Buy Now According to Short Sellers

1) World Kinect Corporation (NYSE:WKC)

Short % of Float (As of 15 August): 14.49%

Number of Hedge Fund Holders: 16

World Kinect Corporation (NYSE:WKC) is an energy management company, which operates through 3 segments- Aviation, Land, and Marine. The company’s Marine segment provides fuel, lubricants, and services to marine fleets, cruise lines, and other fuel suppliers.

Short sellers are concerned about World Kinect Corporation (NYSE:WKC)’s land business, which continues to struggle. In 2Q 2024, gross profit from its land business came in at $80.8 million, exhibiting a decline of 28%. This was mainly because of unfavorable market conditions in North America and Brazil, and lower profit contribution from the company’s natural gas business due to oversupplied market conditions and lower market volatility. Even in the Marine business, its gross profit saw a decline of 13% to $36.7 million mainly because of reduced market volatility YoY.

However, Wall Street analysts believe that World Kinect Corporation (NYSE:WKC) appears to be well-placed for long-term growth. The company sharpened its portfolio via the sale of Avinode. It plans to streamline its Land portfolio for increased ratability and improved operating leverage. Moreover, the company’s expertise in supply fulfillment, technological solutions, and focus on sustainability should continue to act as growth enablers. The cash proceeds from the sale of Avinode should help the company repay debt, and reduce leverage and interest expenses. These measures should translate into strong earnings and margin expansion in 2H 2024.

Therefore, a combination of deleveraging, focus on shareholder returns, and strong and ambitious 2026 guidance should help the company’s stock.

Considering the Wall Street analysts covering the shares of World Kinect Corporation (NYSE:WKC), the average price target stood at $29.00. Insider Monkey’s 2Q 2024 database revealed that 16 hedge funds were long World Kinect Corporation (NYSE:WKC), with total stakes amounting to $70.4 million.

While we acknowledge the potential of WKC as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than the ones mentioned on our list but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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