Zacks Sell List Highlights: Hatteras Financial, Itau Unibanco Holding, Joy Global and Teck Resources
CHICAGO, Oct. 30, 2012 /PRNewswire/ -- Zacks.com releases details on a group of stocks that are currently members of the exclusive Zacks #5 Rank List – Stocks to Sell Now. These stocks are currently rated as a Zacks Rank #5 (Strong Sell): Hatteras Financial Corp. (NYSE: HTS) and Itau Unibanco Holding SA (NYSE: ITUB). Further, Zacks announced #4 Rankings (Sell) on two other widely held stocks: Joy Global Inc. (NYSE: JOY) and Teck Resources Ltd (NYSE: TCK).
Since inception in 1988, the S&P 500 has outperformed the Zacks #5 Rank 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 HTS and ITUB 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:
Hatteras Financial Corp. (NYSE: HTS) announced third -quarter profit of 83 cents per share on October 24 which came behind the Zacks Consensus Estimate by 1 cent. The diluted earnings per share also fell by 20.19% on a year-over-year basis. The Zacks Consensus Estimate for the current year slipped 9 cents per share to $3.40 in the last 30 days. Next year's estimate also dipped 26 cents per share to $3.13 per share in that time span.
Itau Unibanco Holding SA (NYSE: ITUB) posted a second -quarter profit of 37 cents per share on October 24, which came in 4 cent wider than the average forecast. The Zacks Consensus Estimate for 2012 fell to a profit of $1.65 per share from $1.67 over the past month with 1 out of 7 covering analysts slashed forecasts. Next year's forecasts slipped 14 cents to $1.85 per share in the same time span.
Here is a synopsis of why JOY and TCK 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;
Joy Global Inc. (NYSE: JOY) third-quarter profit of $1.79 per share, posted on September 5, lagged analysts projections by nearly 5.79%. For 2012, the Zacks Consensus Estimate moved down 17 cent in the last 60 days as none out of the 17 covering analysts cut back on forecasts. The forecast for next year slid 88 cents to $6.70 per share in the same time span.
Teck Resources Ltd (NYSE: TCK) reported a third-quarter profit of 60 cents per share on October 25, that fell 4.76% short of the Zacks Consensus Estimate. The full-year average forecast is currently pegged at $2.67 per share, compared with the last 30 days projection of $2.88. Next year's forecast dropped 38 cents 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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