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 "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 Protective Life as such a stock due to the following factors:
- PL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $59.0 million.
- PL has traded 556,774 shares today.
- PL traded in a range 246.8% of the normal price range with a price range of $0.32.
- PL traded below its daily resistance level (quality: 71 days, meaning that the stock is crossing a resistance level set by the last 71 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 PL:
Protective Life Corporation, together with its subsidiaries, provides financial services primarily in the United States. The company is engaged in the production, distribution, and administration of insurance and investment products. The stock currently has a dividend yield of 1.4%. PL has a PE ratio of 14.0. Currently there are no analysts that rate Protective Life a buy, no analysts rate it a sell, and 8 rate it a hold.
The average volume for Protective Life has been 1.7 million shares per day over the past 30 days. Protective Life has a market cap of $5.5 billion and is part of the financial sector and insurance industry. The stock has a beta of 1.77 and a short float of 1.8% with 0.67 days to cover. Shares are up 37.2% year-to-date as of the close of trading on Wednesday.
rates Protective Life as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, growth in earnings per share, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. We feel these strengths outweigh the fact that the company shows low profit margins.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 10.6%. Since the same quarter one year prior, revenues rose by 21.1%. 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 60.12% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, PL should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- PROTECTIVE LIFE CORP's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, PROTECTIVE LIFE CORP increased its bottom line by earning $4.86 versus $3.64 in the prior year. This year, the market expects an improvement in earnings ($4.90 versus $4.86).
- PL's debt-to-equity ratio of 0.63 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.
- You can view the full Protective Life Ratings Report.