CHICAGO, March 18, 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): Credit Suisse Group AG (ADR) (NYSE: CS) and MGE Energy, Inc. (Nasdaq: MGEE). Further, Zacks announced #4 Rankings (Sell) on two other widely held stocks: K-Swiss Inc. (Nasdaq: KSWS) and Bally Technologies Inc. (NYSE: BYI) 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 CS and MGEE 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:
Credit Suisse Group AG (ADR)'s (NYSE: CS) full-year earnings per share of 61 cents announced on Feb 10, missed analysts expectations by 44%. The Zacks Consensus Estimate for the full year declined to a profit of $5.26 per share from $5.51 over the past 90 days. Next year's forecast fell 31 cents to a profit of $6.15 per share in the last days.
MGE Energy, Inc. (Nasdaq: MGEE) posted a fourth-quarter profit of 52 cents per share on Feb 24, which was 13 cents wider than analysts' projections. The Zacks Consensus Estimate for 2011 fell 33 cents to a profit of $2.50 per share in the last 30 days as the only covering analyst reduced forecasts. Also the estimates for 2012 fell 42 cents in the same time span.
Here is a synopsis of why KSWS and BYI 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;
K-Swiss Inc. (Nasdaq: KSWS) announced fourth-quarter loss per share of 58 cents on Feb 17 that lagged the Zacks Consensus Estimate by 94%. The full-year average forecast moved down 50 cents to a loss of 99 cents per share in the last 30 days, reflecting cuts by all of the 4 covering analysts. Estimate for 2012 dipped 21 cents to 5 cents per share in the same period.
Bally Technologies Inc. (NYSE: BYI) announced second-quarter earnings of 44 cents per share on Feb 2, which came in nearly 4% short of analysts' expectations. Revenues decreased to $182.7 million from $205.0 million. Diluted earnings per share fell by nearly 6% on a year-over-year-basis. The Zacks Consensus Estimate for 2011 dipped 12 cents to $2.03 per share in the last 30 days as all the 16 covering analysts reduced forecasts. Estimate for 2012 is $2.59 per share, which fell 8 cents 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 +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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