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What Falling Estimates & Price Mean for Tahoe Resources (TAHO)

Zacks Equity Research
Updated

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 Tahoe Resources, Inc. TAHO, 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 TAHO.

A key reason for this move has been the negative trend in earnings estimates revisions. For the full year, we have seen two 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 a loss of 7 cents a share a month ago to its current level of a loss of 10 cents.

Also, for the current quarter, Tahoe Resources has seen one downward estimate revisions versus no revisions in the opposite direction, dragging the consensus estimate to a loss of 3 cents a share from a loss of 2 cent over the past 30 days.

The stock also has seen some pretty dismal trading lately, as the share price has dropped 23.7% in the past month.

Tahoe Resources, Inc. Price and Consensus

Tahoe Resources, Inc. Price and Consensus | Tahoe Resources, Inc. 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 – Basic Materials sector, you may instead consider a better-ranked stock – Arch Coal, Inc. ARCH. 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.

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Zacks Investment Research