Trade-Ideas LLC identified

Hudson City Bancorp

(

HCBK

) 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 Hudson City Bancorp as such a stock due to the following factors:

  • HCBK has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $26.3 million.
  • HCBK has traded 4.7 million shares today.
  • HCBK traded in a range 257.3% of the normal price range with a price range of $0.63.
  • HCBK traded above 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 '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 HCBK:

Hudson City Bancorp, Inc. operates as the holding company of Hudson City Savings Bank that provides various banking products and services in the United States. The stock currently has a dividend yield of 1.7%. HCBK has a PE ratio of 39. Currently there are no analysts that rate Hudson City Bancorp a buy, 1 analyst rates it a sell, and 1 rates it a hold.

The average volume for Hudson City Bancorp has been 2.6 million shares per day over the past 30 days. Hudson City has a market cap of $4.9 billion and is part of the financial sector and banking industry. The stock has a beta of 0.79 and a short float of 1.4% with 2.32 days to cover. Shares are down 8.3% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Hudson City Bancorp as a

buy

. Among the primary strengths of the company is its expanding profit margins over time. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:

  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 8.9%. Since the same quarter one year prior, revenues slightly dropped by 6.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • 41.74% is the gross profit margin for HUDSON CITY BANCORP INC which we consider to be strong. Regardless of HCBK's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, HCBK's net profit margin of 11.89% is significantly lower than the industry average.
  • The change in net income from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Thrifts & Mortgage Finance industry average. The net income has decreased by 9.0% when compared to the same quarter one year ago, dropping from $39.18 million to $35.66 million.
  • Net operating cash flow has significantly decreased to -$28.19 million or 269.33% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • 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 Thrifts & Mortgage Finance industry and the overall market on the basis of return on equity, HUDSON CITY BANCORP INC underperformed against that of the industry average and is significantly less than that of the S&P 500.

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