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 "roof leaker" (crossing below the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified ManpowerGroup as such a stock due to the following factors:
- MAN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $56.5 million.
- MAN has traded 44,692 shares today.
- MAN is trading at 1.88 times the normal volume for the stock at this time of day.
- MAN crossed below its 200-day simple moving average.
'Roof Leaker' stocks are worth watching because trading stocks that begin to experience a breakdown can lead to potentially massive losses. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock may then be subject to emotional selling from investors that can continue to drive the stock lower. Regardless of the impetus behind the price and volume action, when a stock moves with weakness and volume it can indicate the start of a new, potentially dangerous, trend.
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More details on MAN:
ManpowerGroup Inc. provides workforce solutions and services in the Americas, Southern Europe, Northern Europe, and the Asia Pacific Middle East region. The stock currently has a dividend yield of 1.2%. MAN has a PE ratio of 17.6. Currently there are 6 analysts that rate ManpowerGroup a buy, no analysts rate it a sell, and 4 rate it a hold.
The average volume for ManpowerGroup has been 601,700 shares per day over the past 30 days. ManpowerGroup has a market cap of $6.5 billion and is part of the services sector and diversified services industry. The stock has a beta of 2.51 and a short float of 0.7% with 0.82 days to cover. Shares are down 5.1% year-to-date as of the close of trading on Friday.
rates ManpowerGroup as a
. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company shows low profit margins.
Highlights from the ratings report include:
- Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- MANPOWERGROUP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. 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, MANPOWERGROUP increased its bottom line by earning $3.61 versus $2.48 in the prior year. This year, the market expects an improvement in earnings ($5.25 versus $3.61).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Professional Services industry. The net income increased by 61.0% when compared to the same quarter one year prior, rising from $68.20 million to $109.80 million.
- MAN's revenue growth trails the industry average of 17.8%. Since the same quarter one year prior, revenues slightly increased by 5.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- MAN's debt-to-equity ratio is very low at 0.17 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 1.44, which illustrates the ability to avoid short-term cash problems.
- You can view the full ManpowerGroup Ratings Report.