Today's Water-Logged And Getting Wetter Stock: Flowers Foods (FLO)

Trade-Ideas LLC identified Flowers Foods (FLO) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Flowers Foods

(

FLO

) 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 Flowers Foods as such a stock due to the following factors:

  • FLO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $40.7 million.
  • FLO has traded 184,572 shares today.
  • FLO traded in a range 248.4% of the normal price range with a price range of $1.29.
  • FLO traded below its daily resistance level (quality: 57 days, meaning that the stock is crossing a resistance level set by the last 57 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.

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

More details on FLO:

Flowers Foods, Inc. produces and markets bakery products in the United States. It operates through two segments, Direct-Store-Delivery (DSD) and Warehouse Delivery. The DSD segment produces and markets fresh bakery foods, including fresh breads, buns, rolls, tortillas, and snack cakes. The stock currently has a dividend yield of 2.2%. FLO has a PE ratio of 31. Currently there are 2 analysts that rate Flowers Foods a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Flowers Foods has been 1.4 million shares per day over the past 30 days. Flowers has a market cap of $5.6 billion and is part of the consumer goods sector and food & beverage industry. The stock has a beta of 0.87 and a short float of 3.2% with 2.74 days to cover. Shares are up 40.5% year-to-date as of the close of trading on Tuesday.

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 Flowers Foods as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations, expanding profit margins, largely solid financial position with reasonable debt levels by most measures and notable return on equity. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the ratings report include:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 3.3%. Since the same quarter one year prior, revenues slightly increased by 1.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Net operating cash flow has significantly increased by 90.86% to $97.51 million when compared to the same quarter last year. In addition, FLOWERS FOODS INC has also vastly surpassed the industry average cash flow growth rate of -33.08%.
  • 48.55% is the gross profit margin for FLOWERS FOODS INC which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, FLO's net profit margin of 5.82% significantly trails the industry average.
  • The current debt-to-equity ratio, 0.58, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.86 is somewhat weak and could be cause for future problems.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Food Products industry and the overall market on the basis of return on equity, FLOWERS FOODS INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

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 ...