Dean Foods (DF) In A Perilous Reversal
Trade-Ideas LLC identified
(
) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Dean Foods as such a stock due to the following factors:
- DF has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $44.7 million.
- DF has traded 353,936 shares today.
- DF is down 3.5% today.
- DF was up 7.3% yesterday.
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More details on DF:
Dean Foods Company, a food and beverage company, processes and distributes milk, and other dairy and dairy case products in the United States. The stock currently has a dividend yield of 1.6%. Currently there are 2 analysts that rate Dean Foods a buy, no analysts rate it a sell, and 5 rate it a hold.
The average volume for Dean Foods has been 2.0 million shares per day over the past 30 days. Dean has a market cap of $1.7 billion and is part of the consumer goods sector and food & beverage industry. The stock has a beta of 1.35 and a short float of 14.5% with 5.59 days to cover. Shares are down 0.7% year-to-date as of the close of trading on Monday.
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Analysis:
rates Dean Foods as a
. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, poor profit margins and generally higher debt management risk.
Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Food Products industry. The net income increased by 4211.5% when compared to the same quarter one year prior, rising from -$0.65 million to $26.52 million.
- Powered by its strong earnings growth of 2900.00% and other important driving factors, this stock has surged by 32.64% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- DEAN FOODS CO reported significant earnings per share improvement 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, DEAN FOODS CO swung to a loss, reporting -$0.21 versus $3.39 in the prior year. This year, the market expects an improvement in earnings ($1.05 versus -$0.21).
- The gross profit margin for DEAN FOODS CO is currently lower than what is desirable, coming in at 26.56%. Regardless of DF's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, DF's net profit margin of 1.31% is significantly lower than the industry average.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Food Products industry and the overall market, DEAN FOODS CO's return on equity significantly trails that of both the industry average and the S&P 500.
- You can view the full Dean Foods Ratings Report.
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