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Tale of the Tape

Zacks Equity Research

What Makes Net 1 Ueps Technologies (UEPS) a Strong Sell?
September 22, 2016


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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 Net 1 Ueps Technologies Inc. (UEPS - Snapshot Report) , 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 UEPS.

A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen 1 estimate moving down in the past 30 days, compared with no  upward revision. This trend has caused the consensus estimate to trend lower, going from $1.85 a share a month ago to its current level of $1.63.

Also, for the current quarter, Net 1 Ueps Technologies has seen 1 downward estimate revision versus no revision in the opposite direction, dragging the consensus estimate down to 38 cents a share from 45 cents over the past 30 days.  

The stock also has seen some pretty dismal trading lately, as the share price has dropped 15% in the past month.

NET 1 UEPS TECH Price and Consensus

NET 1 UEPS TECH Price and Consensus | NET 1 UEPS TECH 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 Protection-Safety Equipment & Services industry, you may instead consider a better-ranked stock - Lakeland Industries Inc. (LAKE). 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 (Strong Buy) stocks here

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