Stock to Avoid: Hudson Technologies - Analyst Blog


Zacks Investment Research downgraded Hudson Technologies Inc. ( HDSN ) to a Zacks Rank #5 (Strong Sell) on Apr 12, 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?

Hudson Technologies' fourth-quarter 2013 results failed to impress its shareholders as evidenced by a nearly 1% fall in share price since Feb 26. Year to date, the company has yielded a negative return of 23.9%. A snapshot of the quarter's results and outlook are provided below:

The company reported loss per share of 6 cents as against earnings of 11 cents per share reported in the year-ago quarter. However, the result was better than the Zacks Consensus Estimate of a loss of 7 cents a share.

Hudson Technologies' revenues in the quarter decreased 2.0% year over year to $4.8 million. Impact of higher sales volumes was more than offset by lower services revenues. Gross profit margin in the quarter was at 3.6%, down from 20.0% recorded in the year-ago quarter.

In the last 60 days, the Zacks Consensus Estimate for Hudson Technologies has decreased 57.1% to 6 cents for 2014 and by 13.3% to 26 cents for 2015. These estimates reflect a 53.6% year-over-year decline for 2014 and growth of 307.7% for 2015. Lowered earnings estimates have made us dubious about the company's performance in the quarters ahead.

Other Stocks to Consider

Hudson Technologies currently has a market capitalization of $72 million. Other stocks to watch out for in the sector include Illinois Tool Works Inc. ( ITW ), Kadant Inc. ( KAI ) and Middleby Corp. ( MIDD ), all of which carry a Zacks Rank #1 (Strong Buy).

HUDSON TECHNOLO (HDSN): Free Stock Analysis Report

ILL TOOL WORKS (ITW): Free Stock Analysis Report

KADANT INC (KAI): Free Stock Analysis Report

MIDDLEBY CORP (MIDD): Free Stock Analysis Report

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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 , Business , Stocks

Referenced Stocks: HDSN , ITW , KAI , MIDD

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