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Trade-Ideas LLC identified
) as a "roof leaker" (crossing below the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified KKR as such a stock due to the following factors:
- KKR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $61.5 million.
- KKR has traded 1.0 million shares today.
- KKR is trading at 2.25 times the normal volume for the stock at this time of day.
- KKR crossed below its 200-day simple moving average.
'Roof Leaker' stocks are worth watching because trading stocks that begin to experience a breakdown can lead to potentially massive losses. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock may then be subject to emotional selling from investors that can continue to drive the stock lower. Regardless of the impetus behind the price and volume action, when a stock moves with weakness and volume it can indicate the start of a new, potentially dangerous, trend.
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More details on KKR:
KKR & Co. L.P. is a private equity and real estate investment firm specializing in direct and fund of fund investments. It specializes in acquisitions, leveraged buyouts, management buyouts, credit special situations, growth equity, mature, mezzanine, distressed, and middle market investments. The stock currently has a dividend yield of 8.1%. KKR has a PE ratio of 20.3. Currently there are 8 analysts that rate KKR a buy, no analysts rate it a sell, and 3 rate it a hold.
The average volume for KKR has been 2.7 million shares per day over the past 30 days. KKR has a market cap of $10.1 billion and is part of the financial sector and financial services industry. The stock has a beta of 1.43 and a short float of 3% with 3.41 days to cover. Shares are up 1.2% year-to-date as of the close of trading on Thursday.
rates KKR as a
. Among the primary strengths of the company is its expanding profit margins over time. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- KKR & CO LP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, KKR & CO LP reported lower earnings of $1.28 versus $2.29 in the prior year. This year, the market expects an improvement in earnings ($2.64 versus $1.28).
- KKR, with its very weak revenue results, has greatly underperformed against the industry average of 12.6%. Since the same quarter one year prior, revenues plummeted by 68.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- 48.35% is the gross profit margin for KKR & CO LP which we consider to be strong. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, KKR's net profit margin of -0.04% significantly underperformed when compared to the industry average.
- In its most recent trading session, KKR has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- 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 Capital Markets industry. The net income has significantly decreased by 100.2% when compared to the same quarter one year ago, falling from $277.91 million to -$0.58 million.
- You can view the full KKR Ratings Report.