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 Post Holdings, Inc. (POST), 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 #5 (Strong Sell) further confirms weakness in POST.
A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen 4 estimates moving down in the past 30 days, compared with no upward revision. This trend has caused the consensus estimate to trend lower, going from 56 cents a share a month ago to its current level of a loss of 41 cents.
Also, for the current quarter, Post Holdings has seen 4 downward estimate revisions versus no revisions in the opposite direction, dragging the consensus estimate down to 6 cents a share from 39 cents over the past 30 days.
The stock also has seen some pretty dismal trading lately, as the share price has dropped 23.6% 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 Miscellaneous Foods industry, you may instead consider some better-ranked stocks including Aramark (ARMK), Treehouse Foods, Inc. (THS) and Boulder Brands, Inc. (BDBD). While Aramark and Treehouse Foods hold a Zacks Rank #1 (Strong Buy), Boulder Brands carries a Zacks Rank #2 (Buy). With favorable Zacks Ranks, these stocks may be better selections at this time.
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POST HOLDINGS INC (POST): Free Stock Analysis Report
ARAMARK (ARMK): Free Stock Analysis Report
TREEHOUSE FOODS INC (THS): Free Stock Analysis Report
BOULDER BRANDS INC (BDBD): Free Stock Analysis Report
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