Hot or Not, Stock Market Edition: 09/22/2026

Happy Tuesday. Here's what the Zen Ratings are marking up and marking down today:

• Hot: Permian producer SM Energy (SM) is in the cheapest 1% of the entire market; denim icon Levi Strauss (LEVI) has the smart money on its side
• Not: Crypto exchange Coinbase (COIN) ranks dead last among all 11 peers we track; biotech Xenon Pharmaceuticals (XENE) hit an unexpected safety alarm

P.S. For more stocks making moves, check out our Zen Ratings Upgrades & Downgrades screener.

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🔥 HOT: Permian Basin producer SM Energy (SM) drills for oil and gas across South Texas and the Midland Basin, and its recent results suggest the Civitas merger is already paying off. The company raised its second-half production outlook without increasing full-year capital spending, while Q2 delivered record operating cash flow and strong free cash flow. It has also already captured most of the targeted merger synergies. For investors, that means SM is producing more while keeping spending under control, a potentially powerful combination in a strong energy market.

SM has a Zen Rating of A, a Strong Buy recommendation. Looking at the underlying Component Grades that support the overall rating, Value earns an A, while Momentum and Financials receive B grades. That mix says the stock is unusually cheap despite improving execution and a healthy market trend. Growth, Sentiment, and Artificial Intelligence sit at C. The main caution is Safety at D, which reflects the volatility that comes with oil and gas prices. Bottom line: improving production and merger synergies provide the catalyst, while strong Value and Momentum suggest investors may still have upside if execution continues.

🥶 NOT: Cryptocurrency exchange Coinbase (COIN) is the biggest regulated crypto trading platform in the U.S., but its results still depend heavily on trading activity and crypto market sentiment. The regulatory backdrop has improved, but our data suggests the underlying stock picture remains weak.

COIN has a Zen Rating of F, a Strong Sell recommendation. Sentiment earns an F and sits near the very bottom of the model, while Value, Growth, Momentum, and Safety all receive D grades. That is a broad warning: analysts and other sentiment signals are weak, the stock trend is poor, growth is not strong enough to justify the valuation, and risk remains elevated. Financials and Artificial Intelligence are the only C grades. Bottom line: Coinbase has a strong market position and a better regulatory setup than it once did, but the ratings suggest the fundamentals have not caught up with the narrative.

🔥 HOT: Iconic denim maker Levi Strauss (LEVI) is coming off a strong quarter, but you wouldn’t know it from the stock. Shares are down about 15% over the past three months even as revenue grew, adjusted earnings jumped nearly 30%, margins improved, and management raised its full-year outlook. That disconnect could be the opportunity: the business is improving while the stock has pulled back.

LEVI has a Zen Rating of A, a Strong Buy recommendation. Sentiment and Artificial Intelligence both earn A grades, while Safety and Financials receive B grades. That mix suggests confidence in the business remains strong despite the recent selloff, with solid financials supporting the story. Momentum is only C, reflecting that recent weakness, but that also means the stock has room to catch up if results keep improving. Bottom line: Levi’s recent decline may be creating a better entry point into a business whose fundamentals are moving in the opposite direction. (Looking for more high-potential stocks? Start here.) 

🥶 NOT: Neurology-focused biotech Xenon Pharmaceuticals (XENE) just hit a major clinical setback. On September 17, the company paused new enrollment in its depression and bipolar trials after neuropsychiatric side effects, including confusion, coordination issues, and a small number of psychosis cases, showed up in patients taking its lead drug azetukalner. Shares plunged more than 25% on the news. The epilepsy program is still moving forward, but for investors, the psychiatry opportunity suddenly looks much less certain.

XENE has a Zen Rating of F, a Strong Sell recommendation. Safety earns an F (here’s why that matters), while Financials and Growth receive D grades. That mix says the latest clinical setback is landing on an already fragile setup: risk is high, the business is still financially weak, and growth remains dependent on drugs that have yet to reach the market. Value, Momentum, Sentiment, and Artificial Intelligence sit at C, but those middling grades are not enough to offset the bigger concerns. Bottom line: the epilepsy program still gives Xenon a path forward, but with a fresh trial pause and an F for Safety, investors now have a very good reason to wait for more clarity before stepping in.

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