CHICAGO, April 12, 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): Platinum Underwriters Holdings, Ltd. (NYSE: PTP) and Mercury General Corporation (NYSE: MCY). Further, Zacks announced #4 Rankings (Sell) on two other widely held stocks: Owens-Illinois, Inc. (NYSE: OI) and Graham Packaging Company Inc (NYSE: GRM). See the full Zacks #5 Rank List - Stocks to Sell Now visit
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 PTP and MCY 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:
Platinum Underwriters Holdings, Ltd. (NYSE: PTP) announced fourth-quarter loss of 46 cents per share on Feb 8, that lagged analysts' expectations by nearly 167%. This was 99 cents lower than the earnings of December 2009. Total revenue decreased 26% to $212.69 million. The Zacks Consensus Estimate for the current year slipped 48 cents to a loss of $1.28 per share in the last 7 days as all the 5 covering analysts reduced estimates. Next year's estimate dipped 22 cents to 31 cents per share in a span of 30 days.
Mercury General Corporation (NYSE: MCY) posted a fourth-quarter loss of 15 cents per share on Feb 7, which came in 85 cents wider than the average forecast. Total revenue for three months ended December 2010 fell 3.21% as compared to last year. The Zacks Consensus Estimate for the full year fell to a profit of 25 cents per share from $2.82 over the 60 days. Forecast for 2012, fell 23 cents in a span of a couple of a couple of months
Here is a synopsis of why OI and GRM 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;
Owens-Illinois, Inc.'s (NYSE: OI) fourth-quarter earnings of 45 cents per share, announced on Jan 27, missed analysts' expectations by 4%. Revenues for the fourth quarter fell by nearly 50%. The Zacks Consensus Estimate for 2011 dipped 18 cents to $2.87 per share over the past couple of months. The same period has seen a decline of 23 cents in the forecast for 2012, which now stands at $3.47 per share.
Graham Packaging Company Inc (NYSE: GRM) reported a fourth-quarter loss of 58 cents per share on Feb 10 that fell nearly 469% short of the Zacks Consensus Estimate. The full-year average forecast is currently $1.75 per share, compared with last week's projection for a profit of $1.73. During that time, 2 analysts out of 6 revised downward. Next year's forecast dropped 2 cents to $2.07 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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