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 "storm the castle" (crossing above the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified Aflac as such a stock due to the following factors:
- AFL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $158.9 million.
- AFL has traded 2.0 million shares today.
- AFL is trading at 1.59 times the normal volume for the stock at this time of day.
- AFL crossed above its 200-day simple moving average.
'Storm the Castle' stocks are worth watching because trading stocks that begin to experience a breakout can lead to potentially massive profits. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock is then free to find new buyers and momentum traders who can ultimately push the stock significantly higher. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize on. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.
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More details on AFL:
Aflac Incorporated, through its subsidiary, American Family Life Assurance Company of Columbus, provides supplemental health and life insurance products. It operates through two segments, Aflac Japan and Aflac U.S. The stock currently has a dividend yield of 2.7%. AFL has a PE ratio of 9.1. Currently there are 5 analysts that rate Aflac a buy, no analysts rate it a sell, and 10 rate it a hold.
The average volume for Aflac has been 2.3 million shares per day over the past 30 days. Aflac has a market cap of $26.0 billion and is part of the financial sector and insurance industry. The stock has a beta of 1.11 and a short float of 1.4% with 2.33 days to cover. Shares are down 11.6% year-to-date as of the close of trading on Wednesday.
rates Aflac 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, growth in earnings per share, attractive valuation levels, increase in net income and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow.
Highlights from the ratings report include:
- Although AFL's debt-to-equity ratio of 0.26 is very low, it is currently higher than that of the industry average.
- AFLAC INC's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, AFLAC INC increased its bottom line by earning $6.75 versus $6.11 in the prior year. For the next year, the market is expecting a contraction of 8.6% in earnings ($6.17 versus $6.75).
- AFL, with its decline in revenue, underperformed when compared the industry average of 21.6%. Since the same quarter one year prior, revenues slightly dropped by 2.5%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- The company, on the basis of net income growth from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Insurance industry average. The net income increased by 0.6% when compared to the same quarter one year prior, going from $702.00 million to $706.00 million.
- You can view the full Aflac Ratings Report.