Teradata (TDC) Highlighted As Today's Perilous Reversal Stock

Trade-Ideas LLC identified Teradata (TDC) as a "perilous reversal" (up big yesterday but down big today) candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Teradata

(

TDC

) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Teradata as such a stock due to the following factors:

  • TDC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $97.2 million.
  • TDC has traded 203,250 shares today.
  • TDC is down 3.9% today.
  • TDC was up 12.7% yesterday.

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More details on TDC:

Teradata Corporation provides analytic data platforms, marketing and analytic applications, and related services in the United States and internationally. TDC has a PE ratio of 15. Currently there are 3 analysts that rate Teradata a buy, 2 analysts rate it a sell, and 13 rate it a hold.

The average volume for Teradata has been 2.3 million shares per day over the past 30 days. Teradata has a market cap of $3.6 billion and is part of the technology sector and computer hardware industry. The stock has a beta of 1.05 and a short float of 13.4% with 5.62 days to cover. Shares are down 34% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Teradata as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:

  • The debt-to-equity ratio is somewhat low, currently at 0.71, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. To add to this, TDC has a quick ratio of 1.62, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The gross profit margin for TERADATA CORP is rather high; currently it is at 58.42%. Regardless of TDC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 12.87% trails the industry average.
  • Net operating cash flow has decreased to $68.00 million or 33.33% 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.
  • 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 IT Services industry and the overall market, TERADATA CORP's return on equity significantly trails that of both the industry average and the S&P 500.

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