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GDS Holdings (GDS - Free Report) is a Zacks Rank #5 (Strong Sell) following an earnings miss back in November. The stock was trading just over $60 before the print, but it has tumbled down to the $42 level. Let’s take a deeper look at this stock in this Bear of the Day article.
Description
GDS Holdings Limited provides information technology service. It offers integrated solutions, consulting, service and training including data center hosting, IT management and operation outsourcing, business continuity management, disaster recovery and cloud computing services. The company operates primarily in Shanghai, Beijing, Shenzhen, Guangzhou and Chengdu. GDS Holdings Limited is headquartered in Shanghai, the People's Republic of China.
Earnings History
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market’s expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
In the case of GDS, I see four straight misess of the Zacks Consensus Estimate over the last year. This alone does not make the stock a Zacks Rank #1 (Strong Buy) and it doesn’t make it a Zacks Rank #5 (Strong Sell) either.
The Zacks Rank does care about the earnings history, but it is much more heavily influenced by the movement of earnings estimates.
Earnings Estimates
The Zacks Rank tells us which stocks are seeing earnings estimates move higher or in this case lower. For GDS I see estimates moving lower.
This quarter has fallen from -$0.08 to -$0.25.
Next quarter dropped from -$0.18 to -$0.31.
The Zacks Rank is more heavily influenced by the move in the annual numbers, and the movement is mixed for those numbers.
The current year 2021 consensus number has dropped 20 cents to a loss of $0.97.
The next year has dropped from a loss of $0.33 to a loss of $0.93 over the last 60 days.
Negative movement in earnings estimates like that is why this stock is a Zacks Rank #5 (Strong Sell).
It should be noted that a majority of stocks in the Zacks universe are seeing positive earnings estimate revisions. That means that the stocks that are seeing small but negative earnings estimate revisions are falling to a Zacks Rank #5 (Strong Sell).
Image: Bigstock
Bear Of The Day: GDS Holding (GDS)
GDS Holdings (GDS - Free Report) is a Zacks Rank #5 (Strong Sell) following an earnings miss back in November. The stock was trading just over $60 before the print, but it has tumbled down to the $42 level. Let’s take a deeper look at this stock in this Bear of the Day article.
Description
GDS Holdings Limited provides information technology service. It offers integrated solutions, consulting, service and training including data center hosting, IT management and operation outsourcing, business continuity management, disaster recovery and cloud computing services. The company operates primarily in Shanghai, Beijing, Shenzhen, Guangzhou and Chengdu. GDS Holdings Limited is headquartered in Shanghai, the People's Republic of China.
Earnings History
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market’s expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
In the case of GDS, I see four straight misess of the Zacks Consensus Estimate over the last year. This alone does not make the stock a Zacks Rank #1 (Strong Buy) and it doesn’t make it a Zacks Rank #5 (Strong Sell) either.
The Zacks Rank does care about the earnings history, but it is much more heavily influenced by the movement of earnings estimates.
Earnings Estimates
The Zacks Rank tells us which stocks are seeing earnings estimates move higher or in this case lower. For GDS I see estimates moving lower.
This quarter has fallen from -$0.08 to -$0.25.
Next quarter dropped from -$0.18 to -$0.31.
The Zacks Rank is more heavily influenced by the move in the annual numbers, and the movement is mixed for those numbers.
The current year 2021 consensus number has dropped 20 cents to a loss of $0.97.
The next year has dropped from a loss of $0.33 to a loss of $0.93 over the last 60 days.
Negative movement in earnings estimates like that is why this stock is a Zacks Rank #5 (Strong Sell).
It should be noted that a majority of stocks in the Zacks universe are seeing positive earnings estimate revisions. That means that the stocks that are seeing small but negative earnings estimate revisions are falling to a Zacks Rank #5 (Strong Sell).
Chart
GDS Holdings Price and Consensus
GDS Holdings price-consensus-chart | GDS Holdings Quote