Watch Out: Barbarians At The Gate For Northern (NTRS)
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
Trade-Ideas LLC identified
(
) 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 Northern as such a stock due to the following factors:
- NTRS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $73.2 million.
- NTRS has traded 155,488 shares today.
- NTRS traded in a range 263.2% of the normal price range with a price range of $2.65.
- NTRS traded above its daily resistance level (quality: 9 days, meaning that the stock is crossing a resistance level set by the last 9 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 NTRS:
Northern Trust Corporation, through its subsidiaries, provides investment management, asset and fund administration, banking solutions, and fiduciary services for corporations, institutions, and affluent individuals worldwide. The stock currently has a dividend yield of 1.9%. NTRS has a PE ratio of 20.9. Currently there are 2 analysts that rate Northern a buy, 4 analysts rate it a sell, and 6 rate it a hold.
The average volume for Northern has been 1.2 million shares per day over the past 30 days. Northern has a market cap of $16.2 billion and is part of the financial sector and financial services industry. The stock has a beta of 0.92 and a short float of 1.3% with 2.63 days to cover. Shares are up 3.1% year-to-date as of the close of trading on Thursday.
Analysis:
rates Northern as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, expanding profit margins and increase in stock price during the past year. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 12.8%. Since the same quarter one year prior, revenues slightly increased by 6.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- NORTHERN TRUST CORP has improved earnings per share by 40.0% 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, NORTHERN TRUST CORP increased its bottom line by earning $3.32 versus $2.99 in the prior year. This year, the market expects an improvement in earnings ($3.70 versus $3.32).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 43.8% when compared to the same quarter one year prior, rising from $169.70 million to $244.00 million.
- The gross profit margin for NORTHERN TRUST CORP is currently very high, coming in at 96.33%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 20.85% trails the industry average.
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
- You can view the full Northern Ratings Report.
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