Trade-Ideas: Loews (L) Is Today's "Barbarian At The Gate" Stock

Trade-Ideas LLC identified Loews (L) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Loews

(

L

) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Loews as such a stock due to the following factors:

  • L has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $46.0 million.
  • L has traded 119,819 shares today.
  • L traded in a range 253.1% of the normal price range with a price range of $1.20.
  • L traded above its daily resistance level (quality: 25 days, meaning that the stock is crossing a resistance level set by the last 25 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' 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 positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on L:

Loews Corporation, through its subsidiaries, operates as a commercial property and casualty insurance company primarily in the United States. The stock currently has a dividend yield of 0.7%. L has a PE ratio of 2. Currently there is 1 analyst that rates Loews a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Loews has been 1.9 million shares per day over the past 30 days. Loews has a market cap of $13.4 billion and is part of the financial sector and insurance industry. The stock has a beta of 0.92 and a short float of 1.6% with 4.01 days to cover. Shares are down 13.2% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Loews as a

hold

. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and poor profit margins.

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 Insurance industry. The net income increased by 46.5% when compared to the same quarter one year prior, rising from $116.00 million to $170.00 million.
  • Net operating cash flow has increased to $1,045.00 million or 35.36% when compared to the same quarter last year. In addition, LOEWS CORP has also vastly surpassed the industry average cash flow growth rate of -63.72%.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 13.1%. Since the same quarter one year prior, revenues slightly dropped by 4.4%. 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. When compared to other companies in the Insurance industry and the overall market, LOEWS CORP's return on equity is below that of both the industry average and the S&P 500.
  • The gross profit margin for LOEWS CORP is currently extremely low, coming in at 12.49%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 4.94% trails that of the industry average.

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