Trade-Ideas LLC identified

CalAtlantic Group

(

CAA

) 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 CalAtlantic Group as such a stock due to the following factors:

  • CAA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $43.8 million.
  • CAA has traded 96,853 shares today.
  • CAA traded in a range 246.8% of the normal price range with a price range of $1.96.
  • CAA traded below its daily resistance level (quality: 22 days, meaning that the stock is crossing a resistance level set by the last 22 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.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in CAA with the Ticky from Trade-Ideas. See the FREE profile for CAA NOW at Trade-Ideas

More details on CAA:

CalAtlantic Group, Inc. builds single-family attached and detached homes in the United States. The company operates through four segments: North, Southeast, Southwest, and West. The stock currently has a dividend yield of 0.4%. CAA has a PE ratio of 13. Currently there are 7 analysts that rate CalAtlantic Group a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for CalAtlantic Group has been 1.5 million shares per day over the past 30 days. CalAtlantic Group has a market cap of $4.8 billion and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 1.42 and a short float of 16% with 10.54 days to cover. Shares are up 5.4% year-to-date as of the close of trading on Wednesday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates CalAtlantic Group as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, compelling growth in net income and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, poor profit margins and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • CAA's very impressive revenue growth greatly exceeded the industry average of 2.9%. Since the same quarter one year prior, revenues leaped by 152.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Net operating cash flow has significantly increased by 70.63% to -$27.62 million when compared to the same quarter last year. Despite an increase in cash flow of 70.63%, CALATLANTIC GROUP INC is still growing at a significantly lower rate than the industry average of 152.48%.
  • The gross profit margin for CALATLANTIC GROUP INC is rather low; currently it is at 23.17%. It has decreased from the same quarter the previous year. Regardless of the weak results of the gross profit margin, the net profit margin of 6.03% is above that of the industry average.
  • 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. In comparison to the other companies in the Household Durables industry and the overall market, CALATLANTIC GROUP INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.