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Falling Earnings Estimates Signal Weakness Ahead for Playa Hotels & Resorts (PLYA)

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 Playa Hotels & Resorts N.V.PLYA , 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 #4 (Sell) further confirms weakness in PLYA.

A key reason for this move has been the negative trend in earnings estimates revisions. For the full year, we have seen three estimates moving down in the past 30 days, compared with one upward revision. This trend has caused the consensus estimate to trend lower, going from 28 cents per share a month ago to its current level of 25 cents.

Also, for the current quarter, Playa Hotels & Resorts has seen two downward estimates revisions versus one revision in the opposite direction, dragging the consensus estimate to a loss of 3 cents a share from a loss of 1 cent over the past 30 days.

The stock has also seen some pretty dismal trading lately, as the share price has dropped 20.4% in the past month.

Playa Hotels & Resorts N.V. Price and Consensus

Playa Hotels & Resorts N.V. Price and Consensus | Playa Hotels & Resorts N.V. 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 Hotels and Motels industry, you may instead consider a better-ranked stock - Belmond Ltd. BEL . The stock currently holds a Zacks Rank #1 (Strong Buy) and may be a better selection at this time. You can see the complete list of today's Zacks #1 Rank stocks here .

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Belmond Ltd. (BEL): Free Stock Analysis Report

Playa Hotels & Resorts N.V. (PLYA): Free Stock Analysis Report

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


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

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Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

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