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Why Horace Mann (HMN) Could Be Positioned for a Slump

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 Horace Mann Educators Corporation HMN, 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 HMN.

A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen one 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 $1.58 a share a month ago to its current level of 80 cents.

Also, for the current quarter, Horace Mann has seen one 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 75 cents over the past 30 days.  

The stock also has seen some pretty dismal trading lately, as the share price has dropped 8.9% in the past month.

Horace Mann Educators Corporation Price and Consensus

Horace Mann Educators Corporation Price and Consensus | Horace Mann Educators Corporation 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 Insurance - Multi line industry, you may instead consider a better-ranked stock - Cigna Corporation CI. The stock currently holds a Zacks Rank #2 (Buy) and may be a better selection at this time. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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