Quantcast

Falling Earnings Estimates Signal Weakness Ahead for MDC Partners (MDCA)


Shutterstock photo

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 MDC Partners Inc. MDCA , 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 MDCA.

A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen 2 estimates moving down in the past 30 days, compared with no upward revisions. This trend has caused the consensus estimate to trend lower, going from $1.19 a share a month ago to its current level of 89 cents.

Also, for the current quarter, MDC Partners has seen 3 downward estimate revisions versus no revisions in the opposite direction, dragging the consensus estimate down to 26 cents a share from 33 cents over the past 30 days.  

The stock also has seen some pretty dismal trading lately, as the share price has dropped 26.9% in the past month.

MDC PTNRS INC Price and Consensus

MDC PTNRS INC Price and Consensus | MDC PTNRS 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 Advertising/Marketing Services industry, you may instead consider a better-ranked stock - Marin Software Incorporated MRIN . The stock currently holds a Zacks Rank #2 (Buy) and may be a better selection 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

MDC PTNRS INC (MDCA): Free Stock Analysis Report

MARIN SOFTWARE (MRIN): Free Stock Analysis 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 Nasdaq, Inc.



This article appears in: Investing , Earnings , Investing Ideas , Stocks
Referenced Symbols: MDCA , MRIN


More from Zacks.com

Subscribe






Zacks.com
Contributor:

Zacks.com

Equity Research








Research Brokers before you trade

Want to trade FX?