Should You Get Rid of Energy XXI (EXXI) Now?
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 Energy XXI Ltd. (EXXI), 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 EXXI.
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 estimate to trend lower, going from 55 cents a share a month ago to its current level of a loss of 21 cents.
Also, for the current quarter, Energy XXI has seen 1 downward estimate revision versus no revisions in the opposite direction, dragging the consensus estimate down to a loss of 8 cents a share from earnings of 9 cents over the past 30 days.
The stock also has seen some pretty dismal trading lately, as the share price has dropped 52.7% 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 Energy sector, you may instead consider some better-ranked stocks including Seadrill Partners LLC (SDLP), Cheniere Energy Partners LP. (CQP) and Murphy USA Inc. (MUSA). All these stocks hold a Zacks Rank #1 (Strong Buy) and may be better selections at this time.
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ENERGY XXI LTD (EXXI): Free Stock Analysis Report
SEADRILL PARTNERS LLC (SDLP): Free Stock Analysis Report
CHENIERE ENERGY PARTNERS LP (CQP): Free Stock Analysis Report
MURPHY USA INC (MUSA): Free Stock Analysis Report
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