Boston Beer (SAM – Free Report) has only missed the Zacks Consensus Estimates in two of the last seven quarters. It is now a Zacks Rank #5 (Strong Sell) and is the Bear of the Day. Let’s take a look at why this is the case.
Boston Beer is the maker of the Same Adams beer that is solid throughout the world. There are approximately 60 different beer that carry the Samuel or Sam Adams name but the company also makes and sells ciders and other beverages.
SAM missed the Zacks Consensus Estimate of $2.54 by $0.06 for a negative earnings surprise of 2.4%. Revenue came in at $271M while the Zacks Consensus Estimate was looking for $291M.
The Zacks Consensus Estimate has been falling over the last few months. The FY16 estimate stood at $7.84 in March and then fell to $6.45 in September. The estimate currently states at $6.37.
Next year has also seen a move lower in estimates with the 2017 Zacks Consensus Estimate moving from $8.50 to $6.76 over the same time period.
The decline in estimates is the main reason this is a Zacks Rank #5 (Strong Sell) and the Bear of the Day.
Zacks has developed a chart that helps investors see how earnings estimates have impacted the price of the stock over the last several years. We call this chart the price and consensus chart, and each color-coded lines represents analyst estimates over a designated year. As estimates increase, the stock tends to follow. The Zacks Rank is impacted by earnings estimate increases, beats and incorporates the idea of analyst agreement and magnitude. As a Zacks Rank #5 (Strong Sell) we see that estimates are moving higher.
More Stocks to Sell. Now.
Beyond our Bear Stock of the Day, today’s list of 220 Zacks Rank #5 Strong Sells demand even more urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. Many appear to be sound investments but, since 1988, such stocks have actually performed more than 11X worse than the S&P 500.
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