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.

Trade-Ideas LLC identified

Fidelity National Financial

(

FNF

) 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 Fidelity National Financial as such a stock due to the following factors:

  • FNF has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $53.2 million.
  • FNF has traded 633,892 shares today.
  • FNF traded in a range 207.6% of the normal price range with a price range of $1.32.
  • FNF traded below its daily resistance level (quality: 6 days, meaning that the stock is crossing a resistance level set by the last 6 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.

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More details on FNF:

Fidelity National Financial, Inc., together with its subsidiaries, provides title insurance, technology, and transaction services to the real estate and mortgage industries in the United States. It operates through Title, BKFS, and Restaurant Group segments. The stock currently has a dividend yield of 2%. FNF has a PE ratio of 64. Currently there are 5 analysts that rate Fidelity National Financial a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Fidelity National Financial has been 1.2 million shares per day over the past 30 days. Fidelity National Financial has a market cap of $10.7 billion and is part of the financial sector and insurance industry. The stock has a beta of 1.04 and a short float of 2.9% with 5.67 days to cover. Shares are up 12.5% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Fidelity National Financial as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income, good cash flow from operations, notable return on equity and solid stock price performance. We feel its strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 9.6%. Since the same quarter one year prior, revenues rose by 15.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Insurance industry. The net income increased by 490.9% when compared to the same quarter one year prior, rising from -$22.00 million to $86.00 million.
  • Net operating cash flow has significantly increased by 121.11% to $34.00 million when compared to the same quarter last year. In addition, FIDELITY NATL FINL FNF GROUP has also vastly surpassed the industry average cash flow growth rate of 21.17%.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Insurance industry and the overall market on the basis of return on equity, FIDELITY NATL FINL FNF GROUP has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • Powered by its strong earnings growth of 372.72% and other important driving factors, this stock has surged by 38.36% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.

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