Falling Earnings Estimates Signal Weakness Ahead for InterOil Corporation (IOC) - Tale of the Tape

By
A A A

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 InterOil Corporation ( IOC ), 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 IOC.

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 revision. This has caused the consensus estimate for loss to widen, as loss estimates widened from a loss of 14 cents a share a month ago to its current level of a loss of 82 cents.

Also, for the current quarter, InterOil Corporation has seen no estimate revision in either direction, dragging the consensus estimate down to 4 cents a share from 11 cents over the past 30 days.   

The stock also has seen some pretty dismal trading lately, as the share price has dropped 12.09% 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 Oil-Energy sector, you may instead consider some better-ranked stocks including Cameron International Corporation ( CAM ), CNOOC Ltd. ( CEO ) and Canadian Oil Sands Limited ( COSWF ). All these stocks hold a Zacks Rank #1 (Strong Buy) and may be better selections at this time.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

INTEROIL CORP (IOC): Free Stock Analysis Report

CAMERON INTL (CAM): Free Stock Analysis Report

CNOOC LTD ADR (CEO): Free Stock Analysis Report

CDN OIL SANDS (COSWF): Get Free Report

To read this article on Zacks.com click here.

Zacks Investment Research



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Earnings , Investing Ideas , Stocks

Referenced Stocks: IOC , CAM , CEO , COSWF

Zacks.com

Zacks.com

More from Zacks.com:

Related Videos

Stocks

Referenced

100%
100%
100%

Most Active by Volume

183,639,073
  • $42.32 ▲ 3.85%
82,623,623
  • $15.99 ▼ 22.79%
39,547,942
  • $119 ▲ 1.19%
32,107,751
  • $77.62 ▲ 2.63%
29,684,848
  • $10.60 ▲ 2.02%
27,615,309
  • $24.03 ▲ 0.38%
26,917,669
  • $31.10 ▲ 2.07%
26,464,306
  • $47.75 ▲ 0.59%
As of 11/26/2014, 04:15 PM

Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com