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 ?
"After a careful review, we have made the decision to rationalize our footprint by closing underperforming stores, with a particular focus on locations with shorter duration leases," says Joseph Anto, Fred's chief executive officer.
"Given the foregoing shortcomings of DUs, there has been no policy or procedure for DOE (Department of Energy) or ERC (Energy Regulatory Commission) to determine underperforming DUs, whose franchise will be recommended for revocation," he explained.
'I believe Congress' assessment will impose greater accountability on these underperforming distribution utilities to the benefit of the consumers,' he added.
At Elgin Area School District U-46, the state's second-largest, 45 schools were commendable and eight underperforming. None made the exemplary or lowest-performing lists.
Celebrating 17 years in business, Directed Capital has, since 2001, successfully sponsored eight funds, raising more than USD 225m in equity and acquiring more than USD 1.3bn in underperforming commercial real estate mortgage loans.
Of the six banks that have listed in Hong Kong in the past 16 months, all are underperforming the benchmark Hang Seng index, HSI.
The underperforming universities are poorly managed, their senior managements are grossly overpaid irrespective of performance, and they are hindering the improvement in education which the Welsh economy needs badly.
Ms Burns said: "I am concerned because we appear to have a stampede of underperforming students, underperforming schools and underperforming test results.
The FTSE 100 was down 66.97 points, or 1.0 percent at 6,496.77 points by 0841 GMT, sharply underperforming a flat showing on euro zone's EuroSTOXX 50.
The "underperforming" S2 pupils scored 34per cent or less.
BRUSSELS - As part of a restructuring of its United States operations, the Delhaize Group plans to close 15 underperforming Food Lion supermarkets and one underperforming Bloom store.