Trade-Ideas LLC identified

DigitalGlobe

(

DGI

) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified DigitalGlobe as such a stock due to the following factors:

  • DGI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $18.2 million.
  • DGI has traded 61,334 shares today.
  • DGI is up 4.8% today.
  • DGI was down 25% yesterday.

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More details on DGI:

DigitalGlobe, Inc. provides imagery and imagery information products and services in the United States and internationally. DGI has a PE ratio of 71. Currently there are 6 analysts that rate DigitalGlobe a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for DigitalGlobe has been 567,900 shares per day over the past 30 days. DigitalGlobe has a market cap of $1.4 billion and is part of the industrial goods sector and aerospace/defense industry. The stock has a beta of 1.03 and a short float of 12.3% with 5.33 days to cover. Shares are down 51.8% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates DigitalGlobe as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and disappointing return on equity.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 0.8%. Since the same quarter one year prior, revenues rose by 12.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The debt-to-equity ratio is somewhat low, currently at 0.87, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. To add to this, DGI has a quick ratio of 1.64, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The gross profit margin for DIGITALGLOBE INC is currently very high, coming in at 79.10%. 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 4.49% trails the industry average.
  • DGI's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 35.85%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Although its share price is down sharply from a year ago, do not assume that it can now be tagged as cheap and attractive. The reality is that, based on its current price in relation to its earnings, DGI is still more expensive than most of the other companies in its industry.
  • 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. Compared to other companies in the Aerospace & Defense industry and the overall market, DIGITALGLOBE INC's return on equity significantly trails that of both the industry average and the S&P 500.

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