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Falling Earnings Estimates Signal Weakness Ahead for Hansen Medical (HNSN)

Zacks Equity Research

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 Hansen Medical, Inc. (HNSN), 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 HNSN.

A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen no revisions on either side. However, the consensus estimate trend has moved lower, as loss estimates widened from a loss of 45 cents a share a month ago to its current level of a loss of 50 cents.

 Also, for the current quarter, Hansen Medical has seen no estimate revisions on either side. However, consensus estimate trend has widened to a loss of 12 cents a share from a loss of 9 cents over the past 30 days.   

The stock also has seen some pretty dismal trading lately, as the share price has dropped 11.51% 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 Instruments sector, you may instead consider some better-ranked stocks including VeriTeQ Corporation (VTEQ), LabStyle Innovations Corp. (DRIO) and Masimo Corporation (MASI). While VeriTeQ carries a Zacks Rank #1 (Strong Buy), LabStyle Innovations and Masimo carry a Zacks Rank #2 (Buy) and may be better selections at this time.

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HANSEN MEDICAL INC (HNSN): Free Stock Analysis Report

LABSTYLE (DRIO): Free Stock Analysis Report

MASIMO CORP (MASI): Free Stock Analysis Report

VERITEQ CORP (VTEQ): Free Stock Analysis Report


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