Trade-Ideas LLC identified

People's United Financial

(

PBCT

) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified People's United Financial as such a stock due to the following factors:

  • PBCT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $51.7 million.
  • PBCT has traded 2.6 million shares today.
  • PBCT traded in a range 240.1% of the normal price range with a price range of $0.74.
  • PBCT traded below its daily resistance level (quality: 7 days, meaning that the stock is crossing a resistance level set by the last 7 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Water-Logged and Getting Wetter' 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 negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower.

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More details on PBCT:

People's United Financial, Inc. operates as the bank holding company for People's United Bank, National Association that provides commercial banking, retail banking, and wealth management services to individual, corporate, and municipal customers. The stock currently has a dividend yield of 4.3%. PBCT has a PE ratio of 18. Currently there are no analysts that rate People's United Financial a buy, 3 analysts rate it a sell, and 7 rate it a hold.

The average volume for People's United Financial has been 4.6 million shares per day over the past 30 days. People's United Financial 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 14.5% with 11.69 days to cover. Shares are down 2.7% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates People's United Financial as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations, increase in net income and growth in earnings per share. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 6.5%. Since the same quarter one year prior, revenues slightly increased by 10.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The gross profit margin for PEOPLE'S UNITED FINL INC is currently very high, coming in at 87.41%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 19.75% is above that of the industry average.
  • Net operating cash flow has increased to $129.10 million or 14.75% when compared to the same quarter last year. In addition, PEOPLE'S UNITED FINL INC has also vastly surpassed the industry average cash flow growth rate of -72.35%.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Commercial Banks industry average. The net income increased by 9.4% when compared to the same quarter one year prior, going from $64.70 million to $70.80 million.
  • PEOPLE'S UNITED FINL INC's earnings per share improvement from the most recent quarter was slightly positive. Stable earnings per share over the past year indicate the company has sound management over its earnings and share float. We anticipate these figures will begin to experience more growth in the coming year. During the past fiscal year, PEOPLE'S UNITED FINL INC increased its bottom line by earning $0.86 versus $0.85 in the prior year. This year, the market expects an improvement in earnings ($0.90 versus $0.86).

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