Ameren (AEE) Falls Further As It's Water-Logged And Getting Wetter
Trade-Ideas LLC identified
(
) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Ameren as such a stock due to the following factors:
- AEE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $61.9 million.
- AEE has traded 218,148 shares today.
- AEE traded in a range 243.6% of the normal price range with a price range of $1.56.
- AEE traded below its daily resistance level (quality: 27 days, meaning that the stock is crossing a resistance level set by the last 27 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).
Stocks matching the 'Water-Logged and Getting Wetter' 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 negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower.
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More details on AEE:
Ameren Corporation operates as a public utility holding company in the United States. The company engages in the rate-regulated electric generation, transmission, and distribution; and rate-regulated natural gas transmission and distribution businesses. The stock currently has a dividend yield of 3.9%. AEE has a PE ratio of 2. Currently there are 4 analysts that rate Ameren a buy, no analysts rate it a sell, and 5 rate it a hold.
The average volume for Ameren has been 1.7 million shares per day over the past 30 days. Ameren has a market cap of $10.7 billion and is part of the utilities sector and utilities industry. The stock has a beta of 0.46 and a short float of 1.6% with 2.70 days to cover. Shares are down 4.6% year-to-date as of the close of trading on Thursday.
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Analysis:
rates Ameren as a
. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins, good cash flow from operations and increase in stock price during the past year. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.
Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Multi-Utilities industry average. The net income increased by 0.7% when compared to the same quarter one year prior, going from $149.00 million to $150.00 million.
- 36.12% is the gross profit margin for AMEREN CORP which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 10.70% trails the industry average.
- Net operating cash flow has increased to $469.00 million or 13.01% when compared to the same quarter last year. Despite an increase in cash flow, AMEREN CORP's cash flow growth rate is still lower than the industry average growth rate of 29.13%.
- After a year of stock price fluctuations, the net result is that AEE's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- AMEREN CORP's earnings per share declined by 35.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, AMEREN CORP increased its bottom line by earning $2.41 versus $2.10 in the prior year. This year, the market expects an improvement in earnings ($2.55 versus $2.41).
- You can view the full Ameren Ratings Report.
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