What Makes Melco Crown (MPEL) a Strong Sell? – Tale of the Tape

One such stock that you may want to consider dropping is Melco Crown Entertainment Limited (MPEL), 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 MPEL.

A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen 6 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 $1.04 a share a month ago to its current level of 83 cents.

Also, for the current quarter, Melco Crown has seen 2 downward estimate revisions versus no revisions in the opposite direction, dragging the consensus estimate down to 23 cents a share from 25 cents over the past 30 days.

The stock also has seen some pretty dismal trading lately, as the share price has dropped 10.2% 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 Gaming industry, you may instead consider a better-ranked stock – Isle of Capri Casinos, Inc. (ISLE). The stock currently holds a Zacks Rank #1 (Strong Buy) and may be better selection at this time.

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