CHICAGO, March 29, 2011 /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): Agree Realty Corporation (NYSE : ADC) and Capella Education Company (Nasdaq : CPLA). Further, Zacks announced #4 Rankings (Sell) on two other widely held stocks: Grand Canyon Education Inc (Nasdaq : LOPE) and Prestige Brands Holdings, Inc. (NYSE : PBH). To see the full Zacks #5 Rank List - Stocks to Sell Now visit: http://at.zacks.com/?id=92
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 ADC and CPLA 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:
Agree Realty Corporation's (NYSE : ADC) fourth-quarter loss of 12 cents per share, reported on March 1, came in a 73 cents worse than analysts' expectations. Moreover the net income per diluted share also decreased by nearly 39% on a year-over-year basis. For 2011, the Zacks Consensus Estimate moved down 11 cents to a profit of $2.27 per share over the past month. The forecast for 2012 dropped 19 cents to $2.19 per share in the same period.
Capella Education Company (Nasdaq : CPLA) posted a fourth-quarter earnings of $1.09 per share on Feb 15, in contrast to the Zacks Consensus Estimate for a profit of $1.11. The full-year average forecast is pegged at a profit of $3.51 per share, which declined from $3.59 in the last 30 days. Next year's estimate slid 83 cents to $3.62 per share in a span of 60 days.
Here is a synopsis of why LOPE and PBH 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;
Grand Canyon Education Inc (Nasdaq : LOPE) fourth - quarter profit of 29 cents per share, announced on Feb 22, missed analysts' expectations by 12%. Operating income for the fourth quarter of 2010 fell $6.6 million as compared to $17.9 million for the same period in 2009. The Zacks Consensus Estimate for 2011 fell 27 cents to a profit of $1.11 per share over the 30 days as all the 9 covering analysts revised downwards. The same period has seen a decline of 27 cents in the forecast for 2012, which now stands at a profit of $1.36 per share.
Prestige Brands Holdings, Inc. (NYSE : PBH) reported a third-quarter profit of 20 cents per share in the month of February while analysts anticipated a profit of 22 cents. Moreover the diluted EPS for the third month ended December 31, 2010 was $0.04 which was 16 cents lower than the EPS of 2009 in the same period. The Zacks Consensus Estimate for the current year dipped 2 cents to a profit of 80 cents per share in the last 60 days as covering analysts pulled back on expectations.
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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 +27%. 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 (-0.9% versus +9%). Thus, the Zacks Rank system allows investors to truly manage portfolio trading effectively.
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