Falling Earnings Estimates Signal Weakness Ahead for Aixtron (AIXG)

Zacks

Similar to wise buying decisions, exiting certain underperformers at the right time helps maximize portfolio returns. Selling off losers can be difficult, but if both the share price and estimates are falling, it could be time to get rid of the security before more losses hit your portfolio.

One such stock that you may want to consider dropping is Aixtron SE (AIXG), which has witnessed a significant price decline in the past four weeks, and it has seen negative earnings estimate revisions for the current quarter and the current year. A Zacks Rank #4 (Sell) further confirms weakness in AIXG.

A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen 3 estimates moving down in the past 30 days, compared with no upward revisions. This trend has caused the consensus estimate to trend lower, going from a loss of 24 cents a share a month ago to its current level of a loss of 41 cents.

Also, for the current quarter, Aixtron has seen 2 downward estimate revisions versus just 1 revision in the opposite direction, dragging the consensus estimate down to a loss of 10 cents a share from a loss of 7 cents over the past 30 days.   

The stock also has seen some pretty dismal trading lately, as the share price has dropped 12.1 % in the past month.

So it may not be a good decision to keep this stock in your portfolio anymore, at least if you don’t have a long time horizon to wait.

If you are still interested in the Electronics Machinery Manufacturing sector, you may instead consider some better-ranked stocks including Kulicke and Soffa Industries, Inc. (KLIC), Intevac Inc. (IVAC) and Siliconware Precision Industries Co. Ltd. (SPIL). While Kulicke and Soffa sports a Zacks Rank #1 (Strong Buy), Intevac and Siliconware Precision hold Zacks Rank #2 (Buy) and may be better selections at this time.  

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AIXTRON SE ADS (AIXG): Free Stock Analysis Report

KULICKE & SOFFA IND INC (KLIC): Free Stock Analysis Report

INTEVAC INC (IVAC): Free Stock Analysis Report

SILICONWARE PRECISION INST ADS (SPIL): Free Stock Analysis Report


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