Even when we take into consideration the short-term overall market declines due to the novel coronavirus pandemic, some companies have underperformed over the past several years and likely would have fallen even without the influence of the bear market.
Thus, shareholders may want to consider reducing holdings in Helios Technologies Inc (HLIO, Financial) and GreenSky Inc (GSKY, Financial).
First of all, these companies have underperformed the S&P 500 over the past year, two years and three years. Second, they disappoint from a dividend payment standpoint compared to the S&P 500's 2.25% as of March 31. Third, Wall Street sell-side analysts have issued moderate sell recommendation ratings for these two stocks.
Helios Technologies Inc
Shares of the Sarasota, Florida-based manufacturer and seller of solutions for hydraulics and electronics businesses in North America and internationally have fallen 19.4% in the past year, 30% over the past two years and increased by only 5% over the past three years through March 31. The stock has underperformed the S&P 500 index by 12.2%, 28% and 4.4%, respectively.
Currently, Helios Technologies pays a quarterly dividend of 9 cents per common share, generating a dividend yield of 0.95% as of March 31. The next payment should be made on April 20.
Year to date, the share price ($37.92 as of March 31 ) fell 18%.
The market capitalization is approximately $1.22 billion, the price-earnings ratio is 20.17 and the price-sales ratio is 2.19.
GreenSky Inc
Shares of the Atlanta-based tech provider of point-of-sale financing and payment solutions to several clients in the U.S. have fallen by 68% in the past year, 82.7% in the past two years and 82.2% in the past three years through March 31. They underperformed the S&P 500 index by 60.8%, 80.6% and 91.6%, respectively.
GreenSky Inc does not pay dividends.
The share price ($3.82 as of March 31) dropped 57% so far this year.
The market capitalization is $687.2 million, the price-earnings ratio is 7.64 and the price-sales ratio is 1.29.
Disclosure: I have no positions in any securities mentioned.
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