Below, we provide a look at four of the latest POWR Rating downgrades: EOG Resources (EOG), Sabre Corporation (SABR), VEON (VEON), and Cinemark Holdings (CNK).
 

EOG Resources (EOG)

Exploring for oil and natural gas was once a profitable business with considerable growth potential. Times have clearly changed. EOG is likely to continue to struggle as the oil industry gradually fizzles out in the years ahead. Though the natural gas industry has the potential to hold strong, the company’s investment in oil operations should be enough to scare investors away.

The POWR Ratings show EOG has an “F” rating in the Buy & Hold Grade along with a “D” grade in the Industry Rank component. The stock is ranked outside of the top third of nearly 100 Energy – Oil & Gas stocks. EOG has a year-to-date POWR Rating of -42.41%. The stock has a six-month price return of -13.60%.

EOG still has a lofty forward P/E ratio of 45.04, a fairly high figure for an oil stock. Of the dozen analysts who have studied the stock, seven consider it a “Buy” and five consider it a “Hold”, meaning investors would be wise to avoid this stock.

Sabre Corporation (SABR)

SABR’s technology helps the worldwide travel industry operate as smoothly as possible. In short, SABR links travel suppliers with one another as well as travel buyers through a dynamic marketplace. However, the travel industry has greatly suffered amidst the pandemic. As a result, SABR has been downgraded.

The POWR Ratings reveal SABR has an “F” grade in the Buy & Hold component along with a “D” Peer Grade component. SABR is ranked 38th of 59 stocks in the Internet space. SABR has a year-to-date price return of -48.52% along with a three-year price return of -37.77%.

The bottom line is it will take some time for SABR and other travel-related stocks to rebound.

VEON (VEON)

Telecommunications is a winning industry yet VEON appears to be a loser. VEON services include data, digital, broadband, and voice.

The POWR Ratings show VEON has an “F” grade in the Buy & Hold Grade component along with a “D” grade in the Peer Grade and Trade Grade components. VEON is ranked 25th of 35 stocks in the Telecom – Foreign category.

VEON has a year-to-date price return of -38.75% along with a three-year price return of -54.10%. Store closures combined with diminished migrant and roaming customer service revenues along with a reduction in equipment sales have made it difficult for VEON to make money.

Avoid this European telecom until it finds a way to decrease costs and pay down its debt.

Cinemark Holdings (CNK)

As the leader in the film exhibition industry, CNK is struggling during the pandemic. It is quite possible that many CNK theaters will not reopen even if an effective vaccine is distributed to the masses across the next six months. There is a chance a substantial number of customers will simply opt to stream movies at home now that they have gotten into the habit of watching movies from the comfort of their couch during the pandemic.

CNK has an “F” grade in the Buy & Hold Grade POWR Rating component. The stock also has a “D” Industry Rank grade. CNK is ranked 4th of 11 stocks in the Entertainment – Movies/Studios category. CNK has a year-to-date price return of -52.02%. The stock has a six-month price return of -4.31%. CNK has an even uglier three-year price return of -51.38%.

Making matters worse is the fact that the top analysts do not believe in CNK, setting an average analyst price target of $15.29, meaning there is more than a 5% downside.

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