Sophisticated Investors Should Avoid: Luminex Corporation (LMNX), J.Jill Inc. (JILL)

Luminex Corporation (NASDAQ: LMNX) shares are 12.82% up in the year-to-date (YTD) period and have moved -11.81% or -$3.5 lower in the latest trading session. However, stock’s trailing 12-month performance remains nearly +18.21% lower. Comparatively, the stock is -37.32% down YTD and -16.14% over the trailing 3-month period. If we look at the shorter duration, its week performance is -17.57% and -27.40% over the month.

Analyst Recommendations

On September 27, 2019, JP Morgan recommended the LMNX stock is a Underweight, while earlier, Piper Sandler had Resumed the stock as a Overweight on August 18, 2020. 5 analysts offering the recommendations for the stock have a consensus rating of 2.60 to suggest that the LMNX stock is a “Moderate Buy. 1 of the 5 analysts rate the stock as a “Sell”, while 0 has rated it as “Underweight”. 2 recommend buying, with 0 rating it as an Overweight.

The stock currently trades at $26.13 and analysts tracking its performance over the next 12 months have a consensus estimate price target of $38.25. The forecasts give the Luminex Corporation stock a price target range of $48.00 on the higher side while at least one analyst think the stock could plunge to a low of $25.00. The two limits represent an upside potential of 45.56% or -4.52%.

Earnings Forecast

Analysts estimate the earnings to increase 237.50% in the current quarter to $0.2, up from the -$0.12 reported in the same quarter a year ago. For the current year, earnings should grow to an average of $0.8, up 25.70% from -$0.21 reported last year. Analysts also offered guidance for the next financial quarter, with their average projected EPS at between $0.22 and $0.39. Wall Street estimates earnings per share to be at an average of $0.74 for the next year.

Insider Transactions Summary

According to SEC data, total insider shares purchases at the company stands at 55 over the last 12 months, while SEC filings reveal that there have been 63 insider sales over the same period. Insiders have purchases 1,116,946 shares while those sold by company executives and officers stand at 1,452,052. The last 3 months have seen insiders trade a total of 587,775 and 972,520 in purchases and sales respectively.

Shapiro Eric, a SR VP, GLOBAL MARKETING at the company, sold 14,179 shares worth $0.57 million at $40.16 per share on Aug 05. The SVP, Human Resources had earlier sold another 24,283 LMNX shares valued at $0.98 million on Aug 05. The shares were sold at $40.16 per share. SHAMIR NACHUM (President & CEO) sold 8,559 shares at $40.16 per share on Aug 05 for a total of $0.34 million while Rew Richard W. II, (SVP, Gen Counsel & Corp Secy) sold 11,176 shares on Aug 05 for $0.46 million with each share fetching $40.93.

J.Jill Inc. (NYSE:JILL), on the other hand, is trading around $0.42 with a market cap of $19.11M and analyst research firms have a positive stance on its shares. Some analysts are even forecasting -$1.13 per share in earnings this year on a short term (1 year) basis.

Let us briefly look at the J.Jill Inc. (JILL) financials, with a focus on its operating details as indicated in its earnings report for the last quarter.

Company balance sheet and cash flow

JILL’s operating margin was negative on the trailing 12 months basis, remaining steady at -35.10%, while the operating expenses over the recent quarter were at $140.71 million. This represented a -54.68% of the company’s total revenues which amounted $90.97 million. With this in place, we can see that the company’s diluted EPS declined -$1.58 on the year-over-year period, growing to $0.10 as given in the last earnings report.

In terms of the balance sheet & cash flow as of (Jul 2020), the total assets figure advanced to $618.3 million from $633.99 million over the previous quarter. The cash flow from operating activities totaled $2.96 million, significantly lower than the $4.27 million reported in the year-ago quarter. The company’s free cash flow for the quarter was $1.13 million.

Insider activity

Insiders have transacted a total of 12 times at J.Jill Inc. over the last 6 months, with insider purchases undertaken 11 times and accounting for 508,243 shares. Insider sales totaled 61,146 shares over the same period, with these deals completed in 1 transactions. Looking at these numbers, we realize that net purchases over that period are 10.0 shares. Insiders now hold a total of 3.2M shares after the latest sales, with 0.00% net shares purchased.

Major holders

Insiders own 2.70% of the company shares, while shares held by institutions stand at 69.10% with a share float percentage of 17.34M. Investors are also buoyed by the number of investors in a company, with J.Jill Inc. having a total of 93 institutions that hold shares in the company. The top two institutional holders are Renaissance Technologies, LLC with over 0.94 million shares worth more than $0.65 million. As of Jun 29, 2020, Renaissance Technologies, LLC held 2.09% of shares outstanding.

The other major institutional holder is Dimensional Fund Advisors LP, with the investment firm holding over 0.49 million shares as of Jun 29, 2020. The firm’s total holdings are worth over $0.34 million and represent 1.10% of shares outstanding.