What Makes Sigma Designs (SIGM) a Strong Sell? - Tale of the Tape - Advanced Energy Indus (NASDAQ:AEIS)

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 Sigma Designs, Inc. SIGM, 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 #5 (Strong Sell) further confirms weakness in SIGM.

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 revisions. This trend has caused the consensus estimate to trend lower, going from 46 cents a share a month ago to its current level of 10 cents.

Also, for the current quarter, Sigma Designs has seen 1 downward estimate revision versus no revisions in the opposite direction, dragging the consensus estimate down to a loss of 14 cents a share from 11 cents a share over the past 30 days.

The stock also has seen some pretty dismal trading lately, as the share price has dropped 17.3% in the past month.

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 computer and technology sector, you may instead consider some better-ranked stocks including Advanced Energy Industries, Inc. AEIS, Bitauto Holdings Limited BITA and ChyronHego Corp. CHYR. All these stocks hold a Zacks Rank #1 (Strong Buy) and may be better selections at this time.

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ADV ENERGY INDS AEIS: Free Stock Analysis Report

BITAUTO HOLDNGS BITA: Free Stock Analysis Report

CHYRONHEGO CORP CHYR: Free Stock Analysis Report

SIGMA DESIGNS SIGM: Free Stock Analysis Report

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