Underperform

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Underperform

In general, this means to do worse than some particular benchmark. Mutual Fund XYZ is said to underperform the S&P500 if its return falls short of the S&P500 return. However, this language does not take risk into account. That is, one might have a lower return than the benchmark in a particular year because of lower risk exposure. Underperform is also a term used by analysts to describe the prospects of a particular company. Usually, this means that the company will do worse than its industry average. Related: outperform.

Underperform

A broker's or brokerage firm's rating of a security. Such a security is expected to do marginally worse than the market as a whole for the period of time it holds the "underperform" rating. Some firms call the rating "market underperform" "moderate sell" or "weak hold." Different firms have different rating systems, but "underperform" is usually one rating above "sell" and one rating below "market perform" or "neutral." For example, if the market is expected to rise slightly, but a certain company's fundamentals are thought to be slightly weaker than the rest of the market, a brokerage firm might change that company's rating from market perform to underperform.
References in periodicals archive ?
When you hesitate, like this CEO was, then you allow underperformance to score.
8% Underperformance of Other Consumer Goods Investments.
Culpability for the underperformance of the 2000-vintage deals is shared among all property types.
First, I evaluate the sensitivity of SEO underperformance to the choice of benchmarks.
It is true that since the market rally has been driven by fewer sectors and narrow belt set of stocks, a diversified basket of portfolios has tended to underperform -- the more diversified [than the index] you have been, the higher the underperformance would have been," he says.
to the benchmark index Underperformance of consumer goods investments
We expect unimpressive results, due mainly to operating underperformance and negative changes to its mining plan.
Clive Reams, managing director of independent monitoring body Racefax Ltd, says links between underperformance and market drifters are common
Eighty-one percent of these high performing managers had experienced at least one three-year period of benchmark underperformance of 1% or more.
In the letter, Privet outlines its significant concerns regarding the lack of accountability of management and the Board following a sustained period of both operational and share price underperformance.
Donn Vickrey, and his team of research analysts have continued their track record of making early correct calls of underperformance of publicly traded companies.