Weakness Seen in Neonode (NEON) Estimates: Should You Stay Away?

Zacks Equity Research

Wed, Jul 9, 2014, 6:32 AM

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 Neonode, Inc. (NEON), 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 NEON.

A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen no revisions on either side. This trend has caused the consensus estimate to trend lower, going from a loss of 21 cents a share a month ago to its current level of a loss of 34 cents.

Also, for the current quarter, Neonode has seen no estimate revisions on either side. However, the consensus estimate trend moved down to a loss of 11 cents a share from a loss of 9 cents over the past 30 days

The stock also has seen some pretty dismal trading lately, as the share price has dropped 19.73% 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 Software sector, you may instead consider some better-ranked stocks including Autodesk, Inc. (ADSK), Aspen Technology, Inc. (AZPN) and Citrix Systems, Inc. (CTXS). All these stocks hold a Zacks Rank #1 (Strong Buy) and may be better selections at this time.

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NEONODE INC (NEON): Free Stock Analysis Report

AUTODESK INC (ADSK): Free Stock Analysis Report

ASPEN TECH INC (AZPN): Free Stock Analysis Report

CITRIX SYSTEMS INC (CTXS): Free Stock Analysis Report

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Weakness Seen in Neonode (NEON) Estimates: Should You Stay Away?

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