Mosaic (MOS) Showing Signs Of Being Water-Logged And Getting Wetter
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
(
) 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 Mosaic as such a stock due to the following factors:
- MOS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $161.8 million.
- MOS has traded 2.7 million shares today.
- MOS traded in a range 231.7% of the normal price range with a price range of $1.86.
- MOS traded below its daily resistance level (quality: 23 days, meaning that the stock is crossing a resistance level set by the last 23 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 MOS:
The Mosaic Company produces and markets concentrated phosphate and potash crop nutrients for the agricultural industry worldwide. It operates through two segments, Phosphates and Potash. The Phosphates segment owns and operates mines in Florida. The stock currently has a dividend yield of 1.9%. MOS has a PE ratio of 19.6. Currently there are 8 analysts that rate Mosaic a buy, 2 analysts rate it a sell, and 5 rate it a hold.
The average volume for Mosaic has been 3.3 million shares per day over the past 30 days. Mosaic has a market cap of $18.3 billion and is part of the basic materials sector and chemicals industry. The stock has a beta of 0.98 and a short float of 1.3% with 1.40 days to cover. Shares are up 13.7% year-to-date as of the close of trading on Wednesday.
Analysis:
rates Mosaic as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, increase in stock price during the past year, growth in earnings per share and increase in net income. We feel these strengths outweigh the fact that the company shows low profit margins.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 4.7%. Since the same quarter one year prior, revenues slightly increased by 9.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The current debt-to-equity ratio, 0.36, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, MOS has a quick ratio of 2.08, which demonstrates the ability of the company to cover short-term liquidity needs.
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. 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.
- MOSAIC CO reported significant earnings per share improvement 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 year. We feel that this trend should continue. During the past fiscal year, MOSAIC CO increased its bottom line by earning $2.69 versus $2.49 in the prior year. This year, the market expects an improvement in earnings ($3.48 versus $2.69).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Chemicals industry. The net income increased by 179.8% when compared to the same quarter one year prior, rising from $128.90 million to $360.70 million.
- You can view the full Mosaic Ratings Report.
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