Trade-Ideas: Bemis (BMS) Is Today's "Barbarian At The Gate" Stock
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.Trade-Ideas LLC identified Bemis (BMS) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Bemis as such a stock due to the following factors:
- BMS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $27.9 million.
- BMS has traded 149,437 shares today.
- BMS traded in a range 203.7% of the normal price range with a price range of $1.13.
- BMS traded above its daily resistance level (quality: 240 days, meaning that the stock is crossing a resistance level set by the last 240 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).
Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.EXCLUSIVE OFFER: Get the inside scoop on opportunities in BMS with the Ticky from Trade-Ideas. See the FREE profile for BMS NOW at Trade-IdeasMore details on BMS: Bemis Company, Inc. manufactures and sells packaging products and pressure sensitive materials in North America, Latin America, Europe, and the Asia-Pacific. The company operates in three segments: U.S. Packaging, Global Packaging, and Pressure Sensitive Materials. The stock currently has a dividend yield of 2.8%. BMS has a PE ratio of 19.0. Currently there are no analysts that rate Bemis a buy, 2 analysts rate it a sell, and 6 rate it a hold.The average volume for Bemis has been 714,800 shares per day over the past 30 days. Bemis has a market cap of $4.1 billion and is part of the consumer goods sector and consumer non-durables industry. The stock has a beta of 0.39 and a short float of 4.4% with 6.54 days to cover. Shares are down 0.4% year-to-date as of the close of trading on Wednesday.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.TheStreetRatings.com Analysis:TheStreet Quant Ratings rates Bemis as a buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, increase in stock price during the past year and compelling growth in net income. We feel these strengths outweigh the fact that the company shows low profit margins.Highlights from the ratings report include:
- BEMIS CO INC has improved earnings per share by 42.1% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, BEMIS CO INC increased its bottom line by earning $2.04 versus $1.65 in the prior year. This year, the market expects an improvement in earnings ($2.46 versus $2.04).
- The debt-to-equity ratio is somewhat low, currently at 0.85, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.26, which illustrates the ability to avoid short-term cash problems.
- BMS, with its decline in revenue, slightly underperformed the industry average of 5.4%. Since the same quarter one year prior, revenues slightly dropped by 1.2%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- In its most recent trading session, BMS has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- You can view the full Bemis Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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