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Should You Get Rid of LATAM Airlines (LTM) 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 LATAM Airlines Group S.A. LTM, 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 LTM.
 
A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen three estimates moving down in the past 30 days, compared with no upward revisions. This trend has caused the consensus estimate to trend lower, going from 50 cents a share a month ago to its current level of 41 cents.

Also, for the current quarter, LATAM Airlines has seen two downward estimate revisions versus no revisions in the opposite direction, dragging the consensus estimate down to 14 cents a share from 18 cents over the past 30 days.
   
The stock also has seen some pretty dismal trading lately, as the share price has dropped 11.6% in the past month.
 

LATAM Airlines Group S.A. Price and Consensus

LATAM Airlines Group S.A. Price and Consensus | LATAM Airlines Group S.A. Quote

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 Transportation - Airline industry, you may instead consider a better-ranked stock – SkyWest, Inc. SKYW. The stock currently holds a Zacks Rank #1 (Strong Buy) and may be a better selection at this time. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Hottest Tech Mega-Trend of All
 
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
 
See Zacks' 3 Best Stocks to Play This Trend >>


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SkyWest, Inc. (SKYW) : Free Stock Analysis Report
 
LATAM Airlines Group S.A. (LTM) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research

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