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What Falling Estimates & Price Mean for 8x8 (EGHT)

Zacks Equity Research
Updated

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 8x8, Inc. EGHT, 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 EGHT.

A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen nine estimates moving down in the past 30 days, compared with no upward revisions. This trend has caused the consensus estimate to trend lower, going from earnings of 11 cents a share a month ago to its current level of a loss of 15 cents.

Also, for the current quarter, 8x8 has seen five downward estimate revisions versus no revisions in the opposite direction, dragging the consensus estimate down to a loss of 4 cents a share from earnings of 1 cent over the past 30 days.  

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The stock also has seen some pretty dismal trading lately, as the share price has dropped 11.6% in the past month.

8x8 Inc Price and Consensus

8x8 Inc Price and Consensus | 8x8 Inc 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 Communication - Components industry, you may instead consider a better-ranked stock - Turtle Beach Corporation HEAR. 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 stocks here.

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8x8 Inc (EGHT) : Free Stock Analysis Report
 
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Zacks Investment Research