Trade-Ideas LLC identified

ArcelorMittal

(

MT

) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified ArcelorMittal as such a stock due to the following factors:

  • MT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $45.2 million.
  • MT has traded 186,191 shares today.
  • MT is down 3.8% today.
  • MT was up 11.3% yesterday.

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More details on MT:

ArcelorMittal, together with its subsidiaries, operates as an integrated steel and mining company worldwide. The company operates through five segments: NAFTA; Europe; Brazil and Neighboring Countries (Brazil); Africa & Commonwealth of Independent States (ACIS); and Mining. The stock currently has a dividend yield of 4.8%. Currently there are 3 analysts that rate ArcelorMittal a buy, 1 analyst rates it a sell, and 2 rate it a hold.

TheStreet Recommends

The average volume for ArcelorMittal has been 10.1 million shares per day over the past 30 days. ArcelorMittal has a market cap of $5.9 billion and is part of the basic materials sector and metals & mining industry. Shares are down 16.1% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates ArcelorMittal as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, weak operating cash flow and generally high debt management risk.

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 Metals & Mining industry. The net income has significantly decreased by 3331.8% when compared to the same quarter one year ago, falling from $22.00 million to -$711.00 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, ARCELORMITTAL SA underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • The gross profit margin for ARCELORMITTAL SA is currently extremely low, coming in at 8.67%. It has decreased from the same quarter the previous year.
  • Net operating cash flow has declined marginally to $473.00 million or 5.58% when compared to the same quarter last year. Despite a decrease in cash flow ARCELORMITTAL SA is still fairing well by exceeding its industry average cash flow growth rate of -26.89%.
  • MT's debt-to-equity ratio of 0.61 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 0.41 is very low and demonstrates very weak liquidity.

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