Opinions and estimates of professional financial analysts may serve as a major helping hand for retail investors when faced with investment decisions. A positive outlook and high target price may entice you to put your money into a stock, however, if the recommendations are poor, it might completely destroy your investment thesis and your overall faith in the company. The following small-cap Canadian stocks experienced crucial analyst downgrades for their upcoming earnings estimates, and are expected to experience at least a 70% slide in EPS (Earnings PerShare):
Information Service Corp. (TSX: ISV)
The Saskatchewan-based company, responsible for the development, management and administration of land registries, has been struggling all year after hitting a stock-price peak in March 2014. Currently trading at the low end of its 52-week range, the company has had its EPS estimate cut to $1.04 from a previous $4.44, which represents a 76% downgrade.
Innergex Renewable Energy Inc. (TSX: INE)
The owner and operator of renewable power-generating facilities with a focus on hydroelectric, wind power and solar projects, has seen its earnings per share estimates cut by 73% down to a mere $0.11. Despite a solid 14.4% growth in third-quarter revenue (Y/Y), Innergexhas failed to keep costs down and has, overall, been unprofitable for the entire year.
Last on the list is a familiar retailer who is still desperately fighting to stay alive in the Canadian market. With consistently alarming yearly revenue drops of 8%, Sears has failed to see positive growth since 2008. It has fallen to a market cap of $1.2 billion, with $700 million of inventory still on hand and a low cash balance of $500 million. It is no surprise, then, that analysts are fairly bearish on this stock, reducing their EPS estimates by 157% to a loss per share of $2.49.
