Today's Dead Cat Bounce Stock Is Teradata (TDC)
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 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 $79.0 million.
- TDC has traded 208,131 shares today.
- TDC is up 3% today.
- TDC was down 14.1% 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. 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 2.2 million shares per day over the past 30 days. Teradata has a market cap of $4.2 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 6.59 days to cover. Shares are down 41.4% year-to-date as of the close of trading on Thursday.
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Analysis:
rates Teradata as a
. 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 current debt-to-equity ratio, 0.51, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, TDC has a quick ratio of 1.89, which demonstrates the ability of the company to cover short-term liquidity needs.
- Despite the weak revenue results, TDC has outperformed against the industry average of 27.2%. Since the same quarter one year prior, revenues slightly dropped by 7.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- The gross profit margin for TERADATA CORP is rather high; currently it is at 59.55%. 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, TDC's net profit margin of -42.53% significantly underperformed when compared to the industry average.
- Net operating cash flow has decreased to $80.00 million or 42.02% 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.
- You can view the full Teradata Ratings Report.
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