Trade-Ideas LLC identified

Telefonica

(

TEF

) as a pre-market mover with heavy volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Telefonica as such a stock due to the following factors:

  • TEF has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $18.4 million.
  • TEF traded 319,000 shares today in the pre-market hours as of 8:17 AM, representing 15.2% of its average daily volume.

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More details on TEF:

Telefonica, S.A. provides mobile and fixed communication services primarily in the European Union and Latin America. The stock currently has a dividend yield of 7.4%. Currently there is 1 analyst that rates Telefonica a buy, 2 analysts rate it a sell, and 2 rate it a hold.

The average volume for Telefonica has been 1.4 million shares per day over the past 30 days. Telefonica has a market cap of $52.2 billion and is part of the technology sector and telecommunications industry. Shares are down 21.7% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Telefonica as a

hold

. The company's strongest point has been its a solid financial position based on a variety of debt and liquidity measures that we have looked at. At the same time, however, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:

  • TEF, with its decline in revenue, underperformed when compared the industry average of 20.1%. Since the same quarter one year prior, revenues slightly dropped by 0.9%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • TELEFONICA SA's earnings per share declined by 20.0% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, TELEFONICA SA reported lower earnings of $0.00 versus $0.63 in the prior year. This year, the market expects an increase in earnings to $1.23 from $0.00.
  • Looking at the price performance of TEF's shares over the past 12 months, there is not much good news to report: the stock is down 29.96%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Diversified Telecommunication Services industry and the overall market, TELEFONICA SA's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for TELEFONICA SA is currently lower than what is desirable, coming in at 29.04%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 7.19% trails that of the industry average.

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