CHICAGO, Aug. 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): International Rectifier Corporation (NYSE:IRF) and Informatica Corporation (NASDAQ:INFA).Further, Zacks announced #4 Rankings (Sell) on two other widely held stocks: Monster Beverage Corp (NASDAQ:MNST) and Compania de Minas Buenaventura SA (NYSE:BVN).
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 IRF and INFA 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:
International Rectifier Corporation (NYSE:IRF) announced fourth -quarter loss of 18 cents per share on August 22 which came behind the Zacks Consensus Estimate by 3 cents. The diluted earnings per share also fell by 132.73% on a year-over-year basis. The Zacks Consensus Estimate for the current year slipped $1.10 per share to a loss of 49 cents in the last 30 days. Next year's estimate also dipped 93 cents per share to 77 cents per share in the same time span.
Informatica Corporation (NASDAQ:INFA) announced second -quarter profit of 20 cents per share on July 26 which came behind the Zacks Consensus Estimate by 2 cents. The Zacks Consensus Estimate for the current year slipped 17 cents per share to $1.20 in the last 60 days. Next year's estimate also dipped 22 cents per share to $1.40 per share in the same time span.
Here is a synopsis of why MNST and BVN 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;
Monster Beverage Corp (NASDAQ:MNST) second-quarter profit of 59 cents per share, posted on August 09, lagged analysts projections by nearly 3.28%. For 2012, the Zacks Consensus Estimate moved down 5 cent in the last 30 days as 5 out of the 8 covering analysts cut back on forecasts. The forecast for next year slid 4 cents to $2.49 per share in the same time span.
Compania de Minas Buenaventura SA (NYSE:BVN) reported a second-quarter profit of 60 cents per share on August 01, that fell 22.08% short of the Zacks Consensus Estimate. The full-year average forecast is currently pegged at $3.11 per share, compared with the last 30 days projection of $3.51. Next year's forecast dropped 44 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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