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 "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Leapfrog as such a stock due to the following factors:
- LF has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $15.0 million.
- LF has traded 3.3 million shares today.
- LF is up 3.1% today.
- LF was down 8.9% yesterday.
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More details on LF:
LeapFrog Enterprises, Inc. designs, develops, and markets technology-based learning products and related proprietary content for children worldwide. LF has a PE ratio of 23.5. Currently there are 3 analysts that rate Leapfrog a buy, no analysts rate it a sell, and 5 rate it a hold.
The average volume for Leapfrog has been 1.6 million shares per day over the past 30 days. Leapfrog has a market cap of $454.3 million and is part of the consumer goods sector and consumer durables industry. The stock has a beta of 0.72 and a short float of 30.5% with 8.35 days to cover. Shares are down 19.3% year-to-date as of the close of trading on Thursday.
rates Leapfrog 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, attractive valuation levels, notable return on equity 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:
- LF's revenue growth has slightly outpaced the industry average of 0.2%. Since the same quarter one year prior, revenues slightly increased by 4.1%. 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.
- LF has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, LF has a quick ratio of 2.44, which demonstrates the ability of the company to cover short-term liquidity needs.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Leisure Equipment & Products industry and the overall market on the basis of return on equity, LEAPFROG ENTERPRISES INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- 39.49% is the gross profit margin for LEAPFROG ENTERPRISES INC which we consider to be strong. Regardless of LF's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 13.12% trails the industry average.
- You can view the full Leapfrog Ratings Report.