Trade-Ideas LLC identified
) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Graco as such a stock due to the following factors:
- GGG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $36.1 million.
- GGG has traded 127,592 shares today.
- GGG traded in a range 200.7% of the normal price range with a price range of $3.23.
- GGG traded above its daily resistance level (quality: 532 days, meaning that the stock is crossing a resistance level set by the last 532 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).
Stocks matching the 'Barbarian at the Gate' 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 positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.
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More details on GGG:
Graco Inc., together with its subsidiaries, designs, manufactures, and markets equipment to pump, meter, mix, and dispense various fluids and coatings worldwide. The company operates through three segments: Industrial, Process, and Contractor. The stock currently has a dividend yield of 1.6%. GGG has a PE ratio of 14. Currently there are 4 analysts that rate Graco a buy, no analysts rate it a sell, and 6 rate it a hold.
The average volume for Graco has been 424,600 shares per day over the past 30 days. Graco has a market cap of $4.6 billion and is part of the industrial goods sector and industrial industry. The stock has a beta of 1.27 and a short float of 6.9% with 8.90 days to cover. Shares are up 16.5% year-to-date as of the close of trading on Thursday.
rates Graco as a
. 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, notable return on equity, solid stock price performance and increase in net income. We feel its strengths outweigh the fact that the company shows weak operating cash flow.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 20.1%. Since the same quarter one year prior, revenues slightly increased by 6.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The debt-to-equity ratio is somewhat low, currently at 0.64, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.48, which illustrates the ability to avoid short-term cash problems.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Machinery industry and the overall market, GRACO INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Machinery industry. The net income increased by 9.2% when compared to the same quarter one year prior, going from $49.04 million to $53.54 million.
- You can view the full Graco Ratings Report.