Rovi (ROVI) Highlighted As Today's Perilous Reversal 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 or Stephanie Link.
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 Rovi as such a stock due to the following factors:
- ROVI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $37.8 million.
- ROVI has traded 380,306 shares today.
- ROVI is down 5.5% today.
- ROVI was up 8.5% yesterday.
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More details on ROVI:
Rovi Corporation provides integrated solutions for the discovery and personalization of digital entertainment to service providers and consumer electronics (CE) industry worldwide. Currently there are 4 analysts that rate Rovi a buy, no analysts rate it a sell, and 1 rates it a hold.
The average volume for Rovi has been 586,800 shares per day over the past 30 days. Rovi has a market cap of $2.2 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.59 and a short float of 5.1% with 3.03 days to cover. Shares are up 1.6% year-to-date as of the close of trading on Thursday.
Analysis:
rates Rovi as a
. The company's strengths can be seen in multiple areas, such as its compelling growth in net income and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and a generally disappointing performance in the stock itself.
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 Software industry. The net income increased by 90.5% when compared to the same quarter one year prior, rising from -$60.81 million to -$5.81 million.
- ROVI, with its decline in revenue, underperformed when compared the industry average of 10.3%. Since the same quarter one year prior, revenues fell by 11.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Software industry and the overall market, ROVI CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has decreased to $39.51 million or 43.93% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- You can view the full Rovi Ratings Report.
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