Trade-Ideas LLC identified

Quanta Services

(

PWR

) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Quanta Services as such a stock due to the following factors:

  • PWR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $50.6 million.
  • PWR has traded 109,199 shares today.
  • PWR is up 3.4% today.
  • PWR was down 7.7% yesterday.

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More details on PWR:

Quanta Services, Inc. provides specialty contracting services to the electric power, and oil and gas industries in North America and internationally. The company operates through two segments, Electric Power Infrastructure Services and Oil and Gas Infrastructure Services. PWR has a PE ratio of 48. Currently there are 7 analysts that rate Quanta Services a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Quanta Services has been 2.3 million shares per day over the past 30 days. Quanta Services has a market cap of $3.7 billion and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 0.84 and a short float of 4% with 2.95 days to cover. Shares are up 26.4% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Quanta Services as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:

  • PWR's debt-to-equity ratio is very low at 0.13 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.33, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has slightly increased to $199.74 million or 5.55% when compared to the same quarter last year. Despite an increase in cash flow of 5.55%, QUANTA SERVICES INC is still growing at a significantly lower rate than the industry average of 1774.18%.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 10.4%. Since the same quarter one year prior, revenues slightly dropped by 7.9%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • 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. When compared to other companies in the Construction & Engineering industry and the overall market, QUANTA SERVICES INC's return on equity is below that of both the industry average and the S&P 500.
  • The gross profit margin for QUANTA SERVICES INC is currently extremely low, coming in at 14.27%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.19% trails that of the industry average.

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