Trade-Ideas LLC identified

Everest Re Group

(

RE

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

  • RE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $60.9 million.
  • RE has traded 229,139 shares today.
  • RE is trading at 1.61 times the normal volume for the stock at this time of day.
  • RE 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 RE:

Everest Re Group, Ltd., through its subsidiaries, provides reinsurance and insurance products. The company operates through U.S. Reinsurance, International, Bermuda, Insurance, and Mt. Logan Re segments. The U.S. The stock currently has a dividend yield of 2.6%. RE has a PE ratio of 8. Currently there are 2 analysts that rate Everest Re Group a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for Everest Re Group has been 276,900 shares per day over the past 30 days. Everest Re Group has a market cap of $7.6 billion and is part of the financial sector and insurance industry. The stock has a beta of 0.65 and a short float of 4% with 4.73 days to cover. Shares are down 2.9% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Everest Re Group as a

buy

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, solid stock price performance and notable return on equity. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • RE's debt-to-equity ratio is very low at 0.09 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
  • Compared to where it was trading a year ago, RE's share price has not changed very much due to (a) the relatively weak year-over-year performance of the overall market, (b) the company's stagnant earnings, and (c) other mixed results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 15.4%. Since the same quarter one year prior, revenues slightly dropped by 9.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • 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 Insurance industry and the overall market, EVEREST RE GROUP LTD's return on equity exceeds that of both the industry average and the S&P 500.
  • EVEREST RE GROUP LTD has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, EVEREST RE GROUP LTD increased its bottom line by earning $25.94 versus $25.41 in the prior year. For the next year, the market is expecting a contraction of 14.7% in earnings ($22.13 versus $25.94).

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