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 Methanex Corporation as such a stock due to the following factors:
- MEOH has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $36.1 million.
- MEOH has traded 401,220 shares today.
- MEOH traded in a range 209.7% of the normal price range with a price range of $2.09.
- MEOH traded above its daily resistance level (quality: 531 days, meaning that the stock is crossing a resistance level set by the last 531 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 MEOH:
Methanex Corporation produces, supplies, and sells methanol to petrochemical producers and distributors. The company also purchases and re-sells methanol produced by others. The stock currently has a dividend yield of 1.6%. Currently there are 4 analysts that rate Methanex Corporation a buy, no analysts rate it a sell, and 2 rate it a hold.
The average volume for Methanex Corporation has been 374,200 shares per day over the past 30 days. Methanex has a market cap of $4.8 billion and is part of the basic materials sector and chemicals industry. Shares are up 58.7% year to date as of the close of trading on Friday.
rates Methanex Corporation as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, poor profit margins and weak operating cash flow.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 7.3%. Since the same quarter one year prior, revenues rose by 19.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 100.36% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- The net income growth from the same quarter one year ago has exceeded that of the Chemicals industry average, but is less than that of the S&P 500. The net income increased by 3.4% when compared to the same quarter one year prior, going from $52.24 million to $54.00 million.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Chemicals industry and the overall market, METHANEX CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for METHANEX CORP is rather low; currently it is at 18.57%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 7.36% trails that of the industry average.
- You can view the full Methanex Corporation Ratings Report.