Zacks Investment Research downgraded
Chart Industries Inc.
) to a Zacks Rank #5 (Strong Sell) on Apr 8, 2014. Going by the
Zacks model, companies holding a Zacks Rank #5 have strong
chances of performing worse than the broader market.
Why the Downgrade?
Nothing much has changed for Chart Industries, as the company is
still struggling to reach its pre-earnings (fourth-quarter 2013)
closing share price of $90.04. On Feb 25, 2014, the company
released its fourth-quarter 2013 results that failed to impress
its shareholders as well as dampened market sentiments. Since
then, its share price has fallen 18.5%, while the company has
yielded a negative year-to-date return of 3%.
Lackluster results also triggered downward revisions in earnings
estimates. In the last 60 days, all the 11 brokerage firms
covering the stock lowered their earnings estimates for 2014;
while out of 10 firms, 8 decreased their estimates for 2015. The
Zacks Consensus Estimate is at $3.26 and $4.20 for 2014 and 2015,
reflecting a decline of 13.8% and 13.2% respectively.
Lowered earnings estimates along with a negative 13.5% average
earnings surprise have made us dubious about Chart Industries'
performance in the coming quarters. Hence, investors seeking
exposure to metal fabrication companies are recommended to either
avoid investing in or to dispose off their existing holdings in
Other Stocks to Consider
Chart Industries is a $2.2 billion company. Some better-ranked
stocks in the same industry include
DXP Enterprises, Inc.
). While Kadant and Middleby hold a Zacks Rank #1 (Strong Buy),
DXP Enterprises carries a Zacks Rank #2 (Buy).
DXP ENTERPRISES (DXPE): Free Stock Analysis
CHART INDUSTRIE (GTLS): Free Stock Analysis
KADANT INC (KAI): Free Stock Analysis Report
MIDDLEBY CORP (MIDD): Free Stock Analysis
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