Bear Of The Day: Jamba, Inc.

Jamba Inc. (JMBA - Snapshot Report) is once again a Zacks #5 Rank and this will mark the third occasion I've written about this fact. But this has nothing to do with the tastiness or quality of their healthy beverage offerings.

Remember, the Zacks Rank is a purely quantitative model that compares the earnings momentum, based on analyst EPS estimate revisions, of over 4,000 stocks every day.

So for a stock to become a top-ranked Zacks #1 -- and only the top 5% of stocks can do so -- the agreement among analysts and the magnitude of their upward revisions must be sufficiently positive.

Conversely, for a stock to become a bottom-ranked Zacks #5 -- again, only the bottom 5% of stocks get this punishment -- the agreement among analysts is still important and it's the EPS estimates that will be found taking a turn for the worse.

To see why Jamba has become a Zacks #5 Rank so frequently, you need only look at the proprietary Price & Consensus chart to see the repeating pattern of estimates being lowered each year...

Jamba may have a bright future. The stock of this $200 million company certainly hasn't cratered to oblivion and merely trades in a big range these past few years between $10 and $17.

But until the estimates turn back upward, I'd put my money on shares visiting the lower end of that range before the upper end.

Kevin Cook is a Senior Stock Strategist for Zacks where he runs the  more

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