Trade-Ideas LLC identified

Charter Communications

(

CHTR

) 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 Charter Communications as such a stock due to the following factors:

  • CHTR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $377.2 million.
  • CHTR has traded 1.6 million shares today.
  • CHTR is trading at 2.27 times the normal volume for the stock at this time of day.
  • CHTR 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 CHTR:

Charter Communications, Inc., through its subsidiaries, provides entertainment, information, and communications solutions to residential and commercial customers in the United States. Currently there are 6 analysts that rate Charter Communications a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for Charter Communications has been 1.8 million shares per day over the past 30 days. Charter has a market cap of $19.6 billion and is part of the services sector and media industry. The stock has a beta of 1.14 and a short float of 26.1% with 10.97 days to cover. Shares are down 4% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Charter Communications as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins and relatively strong performance when compared with the S&P 500 during the past year. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and feeble growth in the company's earnings per share.

Highlights from the ratings report include:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 7.4%. Since the same quarter one year prior, revenues slightly increased by 6.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • 36.23% is the gross profit margin for CHARTER COMMUNICATIONS INC which we consider to be strong. 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 -4.85% is in-line with the industry average.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Media industry. The net income has significantly decreased by 154.2% when compared to the same quarter one year ago, falling from -$48.00 million to -$122.00 million.
  • Net operating cash flow has declined marginally to $611.00 million or 3.01% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

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