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 Sigma-Aldrich as such a stock due to the following factors:
- SIAL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $71.7 million.
- SIAL has traded 854,655 shares today.
- SIAL traded in a range 218.3% of the normal price range with a price range of $1.06.
- SIAL traded below its daily resistance level (quality: 10 days, meaning that the stock is crossing a resistance level set by the last 10 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 SIAL:
Sigma-Aldrich Corporation, a life science and high technology company, develops, manufactures, purchases, and distributes various chemicals, biochemicals, and equipment worldwide. The stock currently has a dividend yield of 0.7%. SIAL has a PE ratio of 32.9. Currently there is 1 analyst that rates Sigma-Aldrich a buy, no analysts rate it a sell, and 8 rate it a hold.
The average volume for Sigma-Aldrich has been 1.1 million shares per day over the past 30 days. Sigma-Aldrich has a market cap of $16.2 billion and is part of the basic materials sector and chemicals industry. The stock has a beta of 0.43 and a short float of 1.1% with 2.12 days to cover. Shares are up 44.6% year-to-date as of the close of trading on Thursday.
rates Sigma-Aldrich as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- Despite its growing revenue, the company underperformed as compared with the industry average of 9.8%. Since the same quarter one year prior, revenues slightly increased by 3.9%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- SIAL's debt-to-equity ratio is very low at 0.10 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.73, which clearly demonstrates the ability to cover short-term cash needs.
- Compared to its closing price of one year ago, SIAL's share price has jumped by 59.87%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- SIGMA-ALDRICH CORP's earnings per share declined by 8.2% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, SIGMA-ALDRICH CORP increased its bottom line by earning $4.05 versus $3.78 in the prior year. This year, the market expects an improvement in earnings ($4.31 versus $4.05).
- The gross profit margin for SIGMA-ALDRICH CORP is rather high; currently it is at 55.22%. Regardless of SIAL's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SIAL's net profit margin of 15.65% compares favorably to the industry average.
- You can view the full Sigma-Aldrich Ratings Report.