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 or Stephanie Link.
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 Harley-Davidson as such a stock due to the following factors:
- HOG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $97.4 million.
- HOG has traded 1.1 million shares today.
- HOG traded in a range 236.8% of the normal price range with a price range of $2.40.
- HOG traded above its daily resistance level (quality: 37 days, meaning that the stock is crossing a resistance level set by the last 37 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 HOG:
Harley-Davidson, Inc. manufactures cruiser and touring motorcycles. The company operates in two segments, Motorcycles & Related Products and Financial Services. The stock currently has a dividend yield of 1.9%. HOG has a PE ratio of 16.4. Currently there are 8 analysts that rate Harley-Davidson a buy, no analysts rate it a sell, and 7 rate it a hold.
The average volume for Harley-Davidson has been 1.7 million shares per day over the past 30 days. Harley-Davidson has a market cap of $13.5 billion and is part of the consumer goods sector and automotive industry. The stock has a beta of 0.98 and a short float of 3.8% with 5.57 days to cover. Shares are down 3.5% year-to-date as of the close of trading on Friday.
rates Harley-Davidson as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, good cash flow from operations, growth in earnings per share and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 10.1%. Since the same quarter one year prior, revenues slightly increased by 0.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Automobiles industry and the overall market, HARLEY-DAVIDSON INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Net operating cash flow has increased to $179.81 million or 18.30% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -24.72%.
- HARLEY-DAVIDSON INC's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, HARLEY-DAVIDSON INC increased its bottom line by earning $3.87 versus $3.27 in the prior year. This year, the market expects an improvement in earnings ($4.25 versus $3.87).
- 44.31% is the gross profit margin for HARLEY-DAVIDSON 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 6.20% trails the industry average.
- You can view the full Harley-Davidson Ratings Report.