Gold Fields (GFI) Marked As A Dead Cat Bounce 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.
Trade-Ideas LLC identified
(
) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Gold Fields as such a stock due to the following factors:
- GFI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $20.6 million.
- GFI has traded 203,276 shares today.
- GFI is up 3.1% today.
- GFI was down 5% yesterday.
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More details on GFI:
Gold Fields Limited is engaged in the acquisition, exploration, development, and production of gold properties. It also explores for copper. The company holds interests in eight operating mines in Australia, Ghana, Peru, and South Africa. The stock currently has a dividend yield of 0.7%. GFI has a PE ratio of 4.9. Currently there is 1 analyst that rates Gold Fields a buy, 2 analysts rate it a sell, and 2 rate it a hold.
The average volume for Gold Fields has been 5.6 million shares per day over the past 30 days. Gold Fields has a market cap of $3.4 billion and is part of the basic materials sector and metals & mining industry. Shares are down 8.4% year-to-date as of the close of trading on Monday.
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Analysis:
rates Gold Fields as a
. The area that we feel has been the company's primary weakness has been its generally higher debt management risk.
Highlights from the ratings report include:
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, GOLD FIELDS LTD underperformed against that of the industry average and is significantly less than that of the S&P 500.
- Despite currently having a low debt-to-equity ratio of 0.54, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 18.7%. Since the same quarter one year prior, revenues slightly dropped by 9.3%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- Compared to where it was a year ago today, the stock is now trading at a higher level, and has traded in line with the S&P 500. We feel that the combination of its price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.
- 37.37% is the gross profit margin for GOLD FIELDS LTD which we consider to be strong. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of -3.60% is in-line with the industry average.
- You can view the full Gold Fields Ratings Report.
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