U.S. Markets closed
  • S&P 500

    4,173.85
    +61.35 (+1.49%)
     
  • Dow 30

    34,382.13
    +360.68 (+1.06%)
     
  • Nasdaq

    13,429.98
    +304.99 (+2.32%)
     
  • Russell 2000

    2,224.63
    +53.68 (+2.47%)
     
  • Crude Oil

    65.51
    +1.69 (+2.65%)
     
  • Gold

    1,844.00
    +20.00 (+1.10%)
     
  • Silver

    27.50
    +0.46 (+1.69%)
     
  • EUR/USD

    1.2146
    +0.0062 (+0.5101%)
     
  • 10-Yr Bond

    1.6350
    -0.0330 (-1.98%)
     
  • Vix

    18.81
    -4.32 (-18.68%)
     
  • GBP/USD

    1.4102
    +0.0050 (+0.3582%)
     
  • USD/JPY

    109.3470
    -0.0870 (-0.0795%)
     
  • BTC-USD

    47,950.95
    -308.01 (-0.64%)
     
  • CMC Crypto 200

    1,398.33
    +39.77 (+2.93%)
     
  • FTSE 100

    7,043.61
    +80.28 (+1.15%)
     
  • Nikkei 225

    28,084.47
    +636.46 (+2.32%)
     

A Duo of Underperforming Stocks to Ease Up On

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
GuruFocus.com
·3 min read
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

Shareholders of Waters Corporation (NYSE:WAT) and Banc of California, Inc. (NYSE:BANC) have several reasons to consider easing their holdings in these underperforming stocks.

First of all, these companies have significantly underperformed the S&P 500 so far this year, and over the past year and two years. The benchmark for the U.S. market has gained about 1% year-to-date, 18.5% over the past year and 23.2% over the past two years.


Additionally, these stocks have low or nonexistent dividends.

Lastly, Wall Street sell-side analysts recommend to decrease holdings in these two stocks.

Waters Corporation

Shares of the Milford, Massachusetts-based provider of analytical workflow solutions to businesses have underperformed the S&P 500 by 5.6% so far this year, 23.3% in the past year and 41% in the past two years through Jan. 31.

The stock paid a small annual dividend of 1 cent per common share only once in 1996, and since then it has not distributed dividends.

Wall Street sell-side analysts issued a moderate sell recommendation rating for this stock and established an average target price of $207.75, which reflects a 7.2% downside from the share price of $223.79 at close on Friday.

The stock has a market capitalization of $14.42 billion, a price-book ratio of 126.15 compared to the industry median of 4.45 and a price-sales ratio of 6.61 versus the industry median of 3.63.

Despite poor share price performance, the stock still looks overvalued according to the Peter Lynch chart.

The 14-day relative strength index of 38 suggests that the stock is not far from oversold levels.

Banc of California

Shares of the Santa Ana, California-regional bank underperformed the S&P 500 by 7.3% year-to-date, 13.3% in the past year and 42% in the past two years through Jan. 31.

Banc of California paid a quarterly cash dividend of 6 cents per common share on Jan. 2, 2020. The dividend has decreased by 14.2% over the past three years.

Wall Street sell-side analysts issued a moderate sell recommendation rating for this stock and established an average target price of $15 per share, which represents a 6% decline from the share price of $15.96 at close on Friday.

The stock has a market capitalization of $812.11 million, a price-sales ratio of $2.99 versus the industry median of 2.88 and a price-book ratio of 1.13 compared to the industry median of 1.04.

The share price still seems overvalued according to the Peter Lynch chart.

The 14-day relative strength index of 36 suggests that the stock is approaching oversold levels.

Disclosure: I have no positions in any securities mentioned.

Read more here:



Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.

This article first appeared on GuruFocus.