CenterPoint Energy (CNP) 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 CenterPoint Energy as such a stock due to the following factors:
- CNP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $83.6 million.
- CNP has traded 2.6 million shares today.
- CNP traded in a range 313.5% of the normal price range with a price range of $1.11.
- CNP traded below its daily resistance level (quality: 35 days, meaning that the stock is crossing a resistance level set by the last 35 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 CNP:
CenterPoint Energy, Inc. operates as a public utility holding company in the United States. The stock currently has a dividend yield of 5.3%. CNP has a PE ratio of 15. Currently there are 4 analysts that rate CenterPoint Energy a buy, no analysts rate it a sell, and 5 rate it a hold.
The average volume for CenterPoint Energy has been 4.2 million shares per day over the past 30 days. CenterPoint Energy has a market cap of $8.0 billion and is part of the utilities sector and utilities industry. The stock has a beta of 0.59 and a short float of 2.6% with 2.26 days to cover. Shares are down 21% year-to-date as of the close of trading on Thursday.
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Analysis:
rates CenterPoint Energy as a
. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity.
Highlights from the ratings report include:
- Net operating cash flow has increased to $456.00 million or 37.34% when compared to the same quarter last year. In addition, CENTERPOINT ENERGY INC has also modestly surpassed the industry average cash flow growth rate of 29.13%.
- CNP, with its decline in revenue, underperformed when compared the industry average of 8.3%. Since the same quarter one year prior, revenues fell by 18.7%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Multi-Utilities industry average. The net income has significantly decreased by 28.0% when compared to the same quarter one year ago, falling from $107.00 million to $77.00 million.
- Currently the debt-to-equity ratio of 1.88 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. To add to this, CNP has a quick ratio of 0.59, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
- You can view the full CenterPoint Energy Ratings Report.
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