Acacia Research: Zacks’ Bear of the Day Play

Acacia Research (ACTGSnapshot Report) has consistently been a Zacks #4 Rank (Sell) or #5 Rank (Strong Sell) for most of the past two years. In that time, the stock has fallen from $30 to new 5-year lows last week under $11.

Acacia Research Corporation, through its subsidiaries, develops, acquires, and licenses patented technologies. It assists patent owners with the prosecution and development of their patent portfolios, protection of their patented inventions from unauthorized use, generation of licensing revenue from users of their patented technologies and enforcement against unauthorized users of their patented technologies.

The slide in ACTG shares really accelerated this year as analyst earnings estimates plummeted further. In just the past 60 days, the consensus EPS estimate for this year dropped from $0.62 to $0.50 while those for next year fell from $1.23 to $0.86, a 30% wipeout.

You can see the longer-term EPS decline in the Zacks proprietary Price & Consensus chart (2106 estimates not shown yet)…

Until this earnings evaporation stops and reverses, it’s probably best not to put this portfolio of patents in yours.

Kevin Cook is a Senior Stock Strategist for Zacks where he runs the Follow The Money Trader.

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