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 bluebird bio, Inc. (BLUE), 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 BLUE.
A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen 2 estimates moving down in the past 30 days, compared to no upward revision. This trend has caused the consensus estimate of loss to widen, going from a loss of $1.22 a share a month ago to its current level at a loss of $1.36.
Also, for the current quarter, bluebird bio has seen 1 downward estimate revision versus no revision in the opposite direction, dragging the consensus estimate of loss to 32 cents a share from a loss of 30 cents over the past 30 days.
The stock also has seen some pretty dismal trading lately, as the share price has dropped 11% 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 Medical sector, you may instead consider some better-ranked stocks including Actelion Ltd. (ALIOF), Alexion Pharmaceuticals, Inc. (ALXN) and Alkermes plc (ALKS). All these stocks sport a Zacks Rank #1 (Strong Buy) and may be better selections at this time.
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BLUEBIRD BIO INC (BLUE): Free Stock Analysis Report
ACTELION LTD (ALIOF): Free Stock Analysis Report
ALEXION PHARMACEUTICALS INC (ALXN): Free Stock Analysis Report
ALKERMES PLC ORD (ALKS): Free Stock Analysis Report
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