CHICAGO, Jan. 13, 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): FreightCar America, Inc. (Nasdaq: RAIL) and Brookfield Asset Management Inc. (NYSE: BAM). Further, Zacks announced #4 Rankings (Sell) on two other widely held stocks: Becton, Dickinson and Co. (NYSE: BDX) and Nektar Therapeutics (Nasdaq: NKTR). 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 RAIL and BAM 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:
FreightCar America, Inc. (Nasdaq: RAIL) announced a third-quarter loss of 39 cents per share on November 4, which was 35 cents wider than the Zacks Consensus Estimate. Quarterly revenues fell 25% to $41.3 million. For 2010, the average forecast widened to a loss of 53 cents per share from a loss of 38 cents in the last 90 days.
Brookfield Asset Management Inc. (NYSE: BAM) posted third-quarter earnings of 16 cents per share on November 5 while analysts projected a profit of 23 cents. The Zacks Consensus Estimate for the full year slipped 9 cents to 89 cents per share in the couple of months as the covering analyst reduced expectations. The following year's forecast decreased 17 cents to a profit of $1.10 per share in a span of 90 days.
Here is a synopsis of why BDX and NKTR 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;
Becton, Dickinson and Co. (NYSE: BDX) reported a third-quarter profit of $1.24 per share on November 4, which fell 0.80% short of the Zacks Consensus Estimate. The full-year average forecast dropped a cent to $5.51 per share over the past couple of months. During that time, next year's estimate declined 2 cents to $6.08 per share.
Nektar Therapeutics's (Nasdaq: NKTR) third-quarter loss of 9 cents per share, posted on November 4, came in 4 cents worse than the average forecast. The Zacks Consensus Estimate for the current year is pegged at a loss of 32cents per share, a penny wider than last month's projection. Next year's forecast widened to a loss 16 cents per share from a loss of 74 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 +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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