CHICAGO, Feb. 10, 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): Life Partners Holdings, Inc. (Nasdaq: LPHI) and MF Global Holdings Ltd (NYSE: MF). Further, Zacks announced #4 Rankings (Sell) on two other widely held stocks: Meridian Bioscience, Inc. (Nasdaq: VIVO) and Bemis Company, Inc. (NYSE: BMS). 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 LPHI and MF 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:
Life Partners Holdings, Inc.'s (Nasdaq: LPHI) third-quarter profit of 47 cents per share, announced on Jan10, came in a penny lower than analysts' expectations. Moreover the diluted earnings per share reduced 18% on a year-over-year basis and the revenue fell by 16% as compared to 2009 results. The Zacks Consensus Estimate for the full year declined 20 cents to a profit of $1.59 per share over the 30 days as the only covering analyst slashed forecasts.
MF Global Holdings Ltd (NYSE: MF) posted a third-quarter profit of 3 cents per share on Feb 3 while analysts projected a profit of 5 cents. The Zacks Consensus Estimate for 2011 fell 5 cents to a profit of 25 cents per share in the past week as 8 analysts out of 10 reduced expectations. During that time, next year's forecast slipped 13 cents to a profit of 50 cents per share.
Here is a synopsis of why VIVO and BMS 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;
Meridian Bioscience, Inc.'s (Nasdaq: VIVO) first-quarter earnings per share of 15 cents, reported on Jan 20, declined nearly 32% on a year-over-year basis. This apart, earnings missed the Zacks Consensus Estimate by 21%. The full-year average forecast moved down a couple of cents at a profit of 79 cents per share in the last 90 days, reflecting cuts by 5 out of 8 analysts.
Bemis Company, Inc. (NYSE: BMS) reported fourth-quarter earnings of 49 cents per share on Feb 1, which was 2 cents shy of the average forecast. The Zacks Consensus Estimate for the current year fell 3 cents to a profit of $2.40 per share in the last week as 7 analysts out of 11 revised downward. Next year's estimate dipped by 6 cents to $2.70 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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