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 Iconix Brand Group as such a stock due to the following factors:
- ICON has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $27.1 million.
- ICON has traded 340,004 shares today.
- ICON traded in a range 218.1% of the normal price range with a price range of $1.99.
- ICON traded above its daily resistance level (quality: 42 days, meaning that the stock is crossing a resistance level set by the last 42 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 ICON:
Iconix Brand Group, Inc., a brand management company, is engaged in licensing, marketing, and providing trend direction for a portfolio of consumer and entertainment brands primarily in the United States and internationally. ICON has a PE ratio of 14.6. Currently there are 4 analysts that rate Iconix Brand Group a buy, no analysts rate it a sell, and 4 rate it a hold.
The average volume for Iconix Brand Group has been 506,900 shares per day over the past 30 days. Iconix Brand Group has a market cap of $1.8 billion and is part of the consumer goods sector and consumer non-durables industry. The stock has a beta of 1.36 and a short float of 24.4% with 15.11 days to cover. Shares are down 5.3% year-to-date as of the close of trading on Monday.
rates Iconix Brand Group as a
. The company's strengths can be seen in multiple areas, such as its expanding profit margins, notable return on equity and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- The gross profit margin for ICONIX BRAND GROUP INC is currently very high, coming in at 100.00%. ICON has managed to maintain the strong profit margin since the same quarter of last year. Despite the mixed results of the gross profit margin, ICON's net profit margin of 36.20% significantly outperformed against the industry.
- 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 Textiles, Apparel & Luxury Goods industry and the overall market on the basis of return on equity, ICONIX BRAND GROUP INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- ICONIX BRAND GROUP INC's earnings per share declined by 9.1% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ICONIX BRAND GROUP INC increased its bottom line by earning $2.11 versus $1.52 in the prior year. This year, the market expects an improvement in earnings ($2.69 versus $2.11).
- The revenue fell significantly faster than the industry average of 15.0%. Since the same quarter one year prior, revenues fell by 15.3%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- You can view the full Iconix Brand Group Ratings Report.