Zacks Sell List Highlights: Greenhill & Co., Summer Infant, McDonald's and Clearwater Paper
Zacks Equity Research
For Immediate Release
Chicago, IL April 26, 2013 – Zacks.com releases details on a group of stocks that are currently members of the exclusive Zacks Rank #5 List – Stocks to Sell Now. These stocks are currently rated as a Zacks Rank #5 (Strong Sell): Greenhill & Co., Inc. (GHL) and Summer Infant, Inc. (SUMR). Further, Zacks announced #4 Rankings (Sell) on two other widely held stocks: McDonald's Corporation (MCD) and Clearwater Paper Corp (CLW).
Since inception in 1988, the S&P 500 has outperformed the Zacks Rank #5 List of Stocks to Sell Now by 80% annually (+2% vs. +10%). While the rest of Wall Street continued to tout stocks during the market declines of the last few years, Zacks told investors which stocks to sell or avoid.
Here is a synopsis of why GHL and SUMR have a Zacks Rank of 5 (Strong Sell) and should most likely be sold or avoided for the next one to three months. Note that a #5 Strong Sell rating is applied to 5% of all the stocks in the Zacks Rank universe:
Greenhill & Co., Inc. (GHL) announced first-quarter profit of 45 cents per share on April 17, which came behind the Zacks Consensus Estimate by 24 cents. The diluted earnings per share also fell by 15.09% on a year-over-year basis. The Zacks Consensus Estimate for the current year slipped 72 cents per share to $1.85 in the last 30 days. Next year’s estimate also dipped 46 cents per share to $2.42 per share in that time span.
Summer Infant, Inc. (SUMR) posted a fourth -quarter loss of 9 cents per share on March 12, which came in 11 cents wider than the average forecast. The Zacks Consensus Estimate for 2013 fell to a profit of 16 cents per share from 20 cents over the past month. Next year’s forecasts slipped 5 cents to 30 cents per share in the same time span.
Here is a synopsis of why MCD and CLW have a Zacks Rank of 4 (Sell) and should also most likely be sold or avoided for the next one to three months. Note that a #4 Sell rating is applied to 15% of all the stocks ranked by Zacks;
McDonald's Corporation (MCD) first-quarter profit of $1.26 per share, posted on April 19, and lagged analysts’ projections by nearly 0.8%. For 2013, the Zacks Consensus Estimate moved down 7 cents to $5.72 in the last 30 days as 14 out of the 20 covering analysts cut back on forecasts. The forecast for next year slid 8 cents to $6.27 per share in the same time span.
Clearwater Paper Corp (CLW) reported a first-quarter profit of 1 cent per share on April 24, that fell nearly 98.1% short of the Zacks Consensus Estimate. The full-year average forecast is currently pegged at $3.37 per share, compared with the last 30 days projection of $3.66. Next year’s forecast dropped 1 cent per share in the same period.
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About the Zacks Rank
Since 1988, the Zacks Rank has proven that "Earnings estimate revisions are the most powerful force impacting stock prices." Since inception in 1988, #1 Rank Stocks have generated an average annual return of +28%. During the 2000-2002 bear market, Zacks #1 Rank stocks gained +43.8%, while the S&P 500 tumbled -37.6%. Also note that the Zacks Rank system has just as many Strong Sell recommendations (Rank #5) as Strong Buy recommendations (Rank #1). Since 1988, Zacks Rank #5 stocks have significantly underperformed the S&P 500 (2.8% versus +9.7%). Thus, the Zacks Rank system allows investors to truly manage portfolio trading effectively.
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