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 Eaton Vance as such a stock due to the following factors:
- EV has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $23.3 million.
- EV has traded 106,256 shares today.
- EV traded in a range 295.4% of the normal price range with a price range of $2.13.
- EV traded above its daily resistance level (quality: 46 days, meaning that the stock is crossing a resistance level set by the last 46 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 EV:
Eaton Vance Corp., through its subsidiaries, engages in the creation, marketing, and management of investment funds in the United States. It also provides investment management and counseling services to institutions and individuals. The stock currently has a dividend yield of 2.4%. EV has a PE ratio of 21.1. Currently there are 2 analysts that rate Eaton Vance a buy, 2 analysts rate it a sell, and 5 rate it a hold.
The average volume for Eaton Vance has been 784,000 shares per day over the past 30 days. Eaton Vance has a market cap of $4.4 billion and is part of the financial sector and financial services industry. The stock has a beta of 1.78 and a short float of 5.5% with 10.67 days to cover. Shares are down 17.1% year-to-date as of the close of trading on Tuesday.
rates Eaton Vance as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income, expanding profit margins, growth in earnings per share 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:
- The revenue growth came in higher than the industry average of 5.1%. Since the same quarter one year prior, revenues rose by 13.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
- 36.02% is the gross profit margin for EATON VANCE CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 19.80% is above that of the industry average.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Capital Markets industry average. The net income increased by 43.3% when compared to the same quarter one year prior, rising from $49.81 million to $71.36 million.
- EATON VANCE CORP has improved earnings per share by 47.4% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, EATON VANCE CORP reported lower earnings of $1.51 versus $1.72 in the prior year. This year, the market expects an improvement in earnings ($2.35 versus $1.51).
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Capital Markets industry and the overall market, EATON VANCE CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
- You can view the full Eaton Vance Ratings Report.