Each week, The Fly will announce the newest downgrades to Strong Sell in StockNews.com's POWR Ratings algorithmic model.

This Fly exclusive recap identifies stocks with over a $1B market capitalization that have been downgraded this week to the Strong Sell, or "F," rating in the service's proprietary model that analyzes 118 different factors, each of which contribute a little to the stock's predicted likelihood of underperformance. A bell curve distribution of StockNews.com's ratings shows that only the top 5% of the over 5,000 stocks rated by the system are assigned a "Strong Buy," or "A," rating while the bottom 5% are assigned a Strong Sell. The F-rated stocks would have tumbled an average of 18.98% a year since 1999, according to StockNews.com.

This week's downgrades to Strong Sell as determined by the POWR Ratings algorithm:

• Enovix (ENVX) - a designer and manufacturer of advanced silicon-anode lithium-ion battery development and production
• Nextdoor (KIND) - an operator of a hyperlocal social networking service for neighborhoods
• Recursion Pharmaceuticals (RXRX) - a clinical-stage biotechnology company industrializing drug discovery by decoding biology
• Zentalis Pharmaceuticals (ZNTL) - a clinical-stage biopharmaceutical company focused on discovering and developing clinically differentiated small molecule therapeutics targeting fundamental biological pathways of cancers
• KE Holdings (BEKE) - an integrated online and offline platform for housing transactions and services
• Digital World Acquisition (DWAC) - the blank-check company that has agreed to take Trump Media & Technology Group public
• Embark Technology (EMBK) - a developer of autonomous technology for the trucking industry
• Farfetch (FTCH) - operator of a platform for the luxury fashion industry that includes an e-commerce marketplace for luxury brands, boutiques and department stores as well as New Guards Group, a platform for the development of global fashion brands
• System1 (SST) - an omnichannel customer acquisition marketing platform
• Confluent (CFLT) - a data streaming platform that is "pioneering a fundamentally new category of data infrastructure that sets data in motion"
• Cutera (CUTR) - a provider of aesthetic and dermatology solutions
• Lightspeed Commerce (LSPD) - a point-of-sale and e-commerce software provider
• Veru (VERU) - a biopharmaceutical company focused on developing novel medicines for COVID-19 and other viral and ARDS-related diseases

Learn more about the POWR Ratings

The Fly's recent reporting on these stocks includes:

Amid a roughly 24% share decline over the past five days, Loop Capital analyst Ananda Baruah maintained his Buy rating and $50 price target on Enovix (ENVX) this week while stating that the company's announcement of "accelerated engagements" with its Strategic Accounts - greater than $200B market capitalization - is giving him greater "conviction" in the stock's long-term upside potential.

Digital World Acquisition said earlier this week that it was unable to file its Form 10-Q for the quarterly period ended June 30, 2022 within the prescribed time period without unreasonable effort or expense because additional time is needed to prepare the financial statements for the quarterly period ended June 30, 2022. The company anticipates that it will file its Form 10-Q within the five-day grace period provided by Rule 12b-25 of the Securities Exchange Act of 1934, as amended, it stated.

Embark Technology (EMBK) shares plunged on Wednesday following the company's announcement that reverse split of its common stock at a ratio of 1 post-split share for every 20 pre-split shares became effective following close of trading on Nasdaq on Tuesday.

Veru (VERU) shares fell after the company named Jason Davies Executive Vice President - General Manager of Europe, the Middle East and Africa, Latin America, and Asia Pacific for Veru's Infectious Disease Franchise for Veru International. Most recently Davies had been the EMEA Head of Launch Excellence - Pharmaceutical Portfolio at Janssen (JNJ).