Pinnacle West Capital (PNW) Roof Leaking Today

Trade-Ideas LLC identified Pinnacle West Capital (PNW) as a "roof leaker" (crossing below the 200-day simple moving average on higher than normal relative volume) candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Pinnacle West Capital

(

PNW

) as a "roof leaker" (crossing below the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified Pinnacle West Capital as such a stock due to the following factors:

  • PNW has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $62.3 million.
  • PNW has traded 144,741 shares today.
  • PNW is trading at 1.64 times the normal volume for the stock at this time of day.
  • PNW crossed below its 200-day simple moving average.

'Roof Leaker' stocks are worth watching because trading stocks that begin to experience a breakdown can lead to potentially massive losses. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock may then be subject to emotional selling from investors that can continue to drive the stock lower. Regardless of the impetus behind the price and volume action, when a stock moves with weakness and volume it can indicate the start of a new, potentially dangerous, trend.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in PNW with the Ticky from Trade-Ideas. See the FREE profile for PNW NOW at Trade-Ideas

More details on PNW:

Pinnacle West Capital Corporation, through its subsidiary, Arizona Public Service Company, provides retail and wholesale electric services primarily in the State of Arizona. It generates, transmits, and distributes electricity using coal, nuclear, gas, oil, and solar resources. The stock currently has a dividend yield of 3.8%. PNW has a PE ratio of 18. Currently there is 1 analyst that rates Pinnacle West Capital a buy, no analysts rate it a sell, and 10 rate it a hold.

The average volume for Pinnacle West Capital has been 915,900 shares per day over the past 30 days. Pinnacle West has a market cap of $7.2 billion and is part of the utilities sector and utilities industry. The stock has a beta of 0.46 and a short float of 2.3% with 2.58 days to cover. Shares are down 5.3% year-to-date as of the close of trading on Thursday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Pinnacle West Capital as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations, increase in net income and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:

  • PNW's revenue growth has slightly outpaced the industry average of 0.9%. Since the same quarter one year prior, revenues slightly increased by 2.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Electric Utilities industry average. The net income increased by 5.4% when compared to the same quarter one year prior, going from $243.96 million to $257.12 million.
  • 47.60% is the gross profit margin for PINNACLE WEST CAPITAL CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 21.44% is above that of the industry average.
  • Net operating cash flow has slightly increased to $427.08 million or 1.23% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -17.57%.
  • The debt-to-equity ratio is somewhat low, currently at 0.80, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.24 is very weak and demonstrates a lack of ability to pay short-term obligations.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

Loading ...