Bear Of The Day: Franklin Electric (FELE)

The market is red hot. That may trap some investors into buying anything and everything. That is probably the worst thing to do now. The fact is, with the market at all-time highs, the risk is the highest for long-term investors. The reason being, when the whole market rallies, most stocks go up to. It can lead you into a false sense of security. Now is the time when investors should be the most cautious, relying on solid earnings trends to lead them to long-term profits.

Today’s Bear of the Day is a stock with a negative earnings trend that should make long-term investors a bit nervous. I’m talking about Zacks Rank #5 (Strong Sell) Franklin Electric (FELE).

Franklin Electric Co., Inc., together with its subsidiaries, designs, manufactures, and distributes water and fuel pumping systems worldwide. It operates in three segments: Water Systems, Fueling Systems, and Distribution.

The reason for the negative Zacks Rank is the series of negative earnings estimates coming from analysts. Over the last thirty days, four analysts have cut their earnings estimates for the current year. That bearish sentiment has dropped our Zacks Consensus Estimate for the current year from $2.39 to $2.29. It has also helped underpin a negative trend for the stock price, upsetting many long-term investors.

Investors looking for other stocks in the Manufacturing – Electronics industry have a few other stocks to research despite the industry being in the Bottom 42% of our Zacks Industry Rank. Both Emerson (NYSE:EMR) Electric (EMR) and Regal Beloit (RBC) are Zacks Rank #2 (Buy) stocks in the same industry.

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