Tractor Supply (TSCO) Falls Further As It's Water-Logged And Getting Wetter
Trade-Ideas LLC identified
(
) 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 Tractor Supply as such a stock due to the following factors:
- TSCO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $65.6 million.
- TSCO has traded 1.0 million shares today.
- TSCO traded in a range 223.1% of the normal price range with a price range of $3.70.
- TSCO traded below its daily resistance level (quality: 24 days, meaning that the stock is crossing a resistance level set by the last 24 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.
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More details on TSCO:
Tractor Supply Company operates rural lifestyle retail stores in the United States. The stock currently has a dividend yield of 0.9%. TSCO has a PE ratio of 31. Currently there are 16 analysts that rate Tractor Supply a buy, no analysts rate it a sell, and 4 rate it a hold.
The average volume for Tractor Supply has been 1.3 million shares per day over the past 30 days. Tractor Supply has a market cap of $12.3 billion and is part of the services sector and specialty retail industry. The stock has a beta of 1.32 and a short float of 4.2% with 6.41 days to cover. Shares are up 13.9% year-to-date as of the close of trading on Thursday.
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Analysis:
rates Tractor Supply as a
. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, increase in net income, revenue growth, good cash flow from operations and solid stock price performance. We feel its strengths outweigh the fact that the company shows low profit margins.
Highlights from the ratings report include:
- TRACTOR SUPPLY CO has improved earnings per share by 16.4% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, TRACTOR SUPPLY CO increased its bottom line by earning $2.66 versus $2.33 in the prior year. This year, the market expects an improvement in earnings ($3.08 versus $2.66).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Specialty Retail industry average. The net income increased by 14.0% when compared to the same quarter one year prior, going from $76.60 million to $87.31 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 9.1%. Since the same quarter one year prior, revenues slightly increased by 8.5%. 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 847.07% to $10.04 million when compared to the same quarter last year. In addition, TRACTOR SUPPLY CO has also vastly surpassed the industry average cash flow growth rate of -10.88%.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 27.65% over the past year, a rise that has exceeded that of the S&P 500 Index. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- You can view the full Tractor Supply Ratings Report.
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