While the market sighed a collective breath of relief after the Fed cut 50-bps, this week has been anything but bullish for the broad market. I’m looking at 5 consecutive red daily candles on the Russell 2000. Long-term investors out there should not despair. Rather, there are going to be a ton of stocks which were overvalued which are going to come on back down to Earth.
Rather than blindly buying all the dips out there thought, you should focus your attention on stocks with strong earnings trends, and try to avoid those with earnings moving to the downside. Unless, of course, you have the patience of a saint and a good reason to believe a turnaround is eminent.
One stock that’s seen earnings estimates move in the wrong direction is today’s Bear of the Day, Daktronics (DAKT). Daktronics designs, manufactures, and sells electronic scoreboards, programmable display systems and large screen video displays for sporting, commercial, and transportation applications in the United States and internationally.
Current year estimate revisions are the reason why this stock is currently a Zacks Rank #5 (Strong Sell).Following its last report, analysts have come out and cut expectations for the current quarter, next quarter and current year. The estimate revisions have dropped our Zacks Consensus Estimates for the current year from $1.13 to 90 cents. That means current year earnings are set to contract 29.69%.
The good news for long-term investors is that nest year’s numbers are forecast to pick back up. Next year’s Zacks Consensus Estimate is up from 92 cents to $1.17. That is growth of 30.56% for the current year.
The Electronics – Miscellaneous Products industry ranks in the Bottom 35% of our Zacks Industry Rank. There are a handful of names in this industry which are in the good graces of our Zacks Rank. These include Greenland Technologies (GTEC) and Hayward Holdings (HAYW).
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 5 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How To Profit From Trillions On Spending For Infrastructure >>Daktronics, Inc. (DAKT) : Free Stock Analysis Report
Greenland Technologies Holding Corporation (GTEC) : Free Stock Analysis Report
Hayward Holdings, Inc. (HAYW) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
