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 Comverse, Inc. (CNSI), 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 CNSI.
A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen 1 estimate moving down in the past 30 days, compared with no upward revisions. This trend has caused the consensus loss estimate to widen, going from a loss of 13 cents a share a month ago to its current level of a loss of $2.18.
Also, for the current quarter, Comverse has seen 1 downward estimate revision versus no revisions in the opposite direction, widening the consensus loss estimate to a loss of 94 cents a share from a loss of 16 cents over the past 30 days.
The stock also has seen some pretty dismal trading lately, as the share price has dropped 16.2% 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 communication network software sector, you may instead consider a better-ranked stock - NeuStar, Inc. (NSR). The stock currently holds a Zacks Rank #1 (Strong Buy) and may be better selection at this time.
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COMVERSE INC (CNSI): Free Stock Analysis Report
NEUSTAR INC -A (NSR): Free Stock Analysis Report
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