Trade-Ideas LLC identified

ING Groep

(

ING

) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified ING Groep as such a stock due to the following factors:

  • ING has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $52.4 million.
  • ING has traded 195,506 shares today.
  • ING is up 3.8% today.
  • ING was down 6.3% yesterday.

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More details on ING:

ING Groep N.V., a financial institution, provides various banking products and services to individuals, small and medium-sized enterprises, and mid-corporates. It operates through Retail Netherlands, Retail Belgium, Retail Germany, Retail Other, and Wholesale Banking segments. The stock currently has a dividend yield of 5.6%. ING has a PE ratio of 9. Currently there is 1 analyst that rates ING Groep a buy, 1 analyst rates it a sell, and none rate it a hold.

The average volume for ING Groep has been 3.2 million shares per day over the past 30 days. ING Groep has a market cap of $48.6 billion and is part of the financial sector and banking industry. Shares are down 24.4% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates ING Groep as a

sell

. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, poor profit margins, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Commercial Banks industry. The net income has significantly decreased by 122.9% when compared to the same quarter one year ago, falling from $1,419.13 million to -$324.65 million.
  • The gross profit margin for ING GROEP NV is currently lower than what is desirable, coming in at 32.54%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, ING's net profit margin of -8.14% significantly underperformed when compared to the industry average.
  • Net operating cash flow has significantly decreased to -$1,579.56 million or 117.80% when compared to the same quarter last year. Despite a decrease in cash flow ING GROEP NV is still fairing well by exceeding its industry average cash flow growth rate of -155.00%.
  • ING's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 26.83%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • 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. When compared to other companies in the Commercial Banks industry and the overall market, ING GROEP NV's return on equity is below that of both the industry average and the S&P 500.

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