Zacks Investment Research downgraded Trinseo SA (TSE) to a Zacks Rank #5 (Strong Sell) on Jan 14, 2015. Going by the Zacks model, companies holding a Zacks Rank #5 have strong chances of performing worse than the broader market.
Why the Downgrade?
Sentiments are weak for Trinseo SA as the company has failed to perform well in the past few quarters. As last reported, the company’s earnings came in at one cent per share in third-quarter 2014, way below the Zacks Consensus Estimate of 15 cents and the year-ago earnings of 28 cents.
Revenues were down 0.31% year over year, while costs of sales increased 2% year over year, impacting gross profit. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) declined 13.9% over the year-ago quarter.
Considering lower-than-expected second and third-quarter 2014 results, Trinseo SA’s average earnings surprise presently stands at -52.92%. Also, it has an Earnings ESP of -566.67% for the fourth quarter and -38.24% for 2014.
Over the last 60 days, the Zacks Consensus Estimate of Trinseo SA has decreased from 34 cents of earnings per share to a loss of 6 cents per share for fourth-quarter 2014. The same dropped 43.8% to 68 cents per share for 2014 and 15.4% to $1.92 for 2015.
Other Stocks to Consider
Trinseo SA currently has a $686 million market capitalization. Some better-ranked stocks in the chemical industry include Kronos Worldwide, Inc. (KRO), Olin Corp. (OLN) and Trecora Resources (TREC). While both Kronos Worldwide and Olin Corp. sport a Zacks Rank #1 (Strong Buy), Trecora Resources carries a Zacks Rank #2 (Buy).
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