AMC Networks Inc. (AMCX, Financial) and The Michaels Companies, Inc. (MIK, Financial) have disappointed their shareholders, underperforming the market by wide margins over the past several years and never paying any dividends.
Furthermore, analysts on Wall Street have issued issued a moderate sell recommendation rating for these companies, which doesn’t encourage maintaining any current holdings of them. Thus, investors may want to consider easing their holdings.
Shares of AMC Networks have fallen 28.5% so far this year, 34.6% over the last 52 weeks and 37% over the last five years through Wednesday. The company has underperformed the S&P 500 by 54%, 49.4% and 86.6%, respectively.
The New York-based entertainment company closed at $39.24 per share on Wednesday for a market capitalization of $2.18 billion. The stock has a price-earnings ratio of 4.91 versus the industry median of 17.39 and a price-sales ratio of 0.74 compared to the industry median of 1.17. Shares appear cheap, but this is because the stock is oversold.
AMC Networks has an average target price of $48.88 to hit within 52 weeks, but the likelihood that it will really happen must be very low as analysts recommend a moderate sell rating for the stock.
GuruFocus assigned a moderate 4 out of 10 rating for the company's financial strength, but a very high rating of 9 out of 10 for its profitability.
The Michaels Companies
Shares of The Michaels Companies have declined 34% year to date, 49% over the past year and 58.7% over the past five years through Wednesday. They have underperformed the S&P 500 Index by 58.2%, 61.6% and 110%, respectively.
Shares of the Irving, Texas-based operator of arts and crafts specialty retail stores for North American makers and do-it-yourself home decorators closed at $8.94 on Wednesday for a market capitalization of $1.39 billion. The stock has a price-earnings ratio of 4.51 versus the industry median of 17.08 and a price-sales ratio of 0.3 versus the industry median of 0.55. Despite the share price fall, the stock is still far from the oversold level.
The stock has a moderate sell recommendation rating. Analysts issued an average target price of $6.75, reflecting a 24.5% downside from Wednesday’s closing price.
GuruFocus issued a low 3 out of 10 rating for the company's financial strength, but a high rating of 8 out of 10 for its profitability.
Disclosure: I have no positions in any securities mentioned.
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