Trade-Ideas LLC identified




) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Outerwall as such a stock due to the following factors:

  • OUTR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $31.1 million.
  • OUTR has traded 51,316 shares today.
  • OUTR is down 3.4% today.
  • OUTR was up 11% yesterday.

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More details on OUTR:

Outerwall Inc., through its subsidiaries, provides automated retail solutions primarily in the United States, Canada, Puerto Rico, Ireland, and the United Kingdom. The stock currently has a dividend yield of 4.4%. OUTR has a PE ratio of 1. Currently there are 4 analysts that rate Outerwall a buy, 3 analysts rate it a sell, and 3 rate it a hold.

The average volume for Outerwall has been 696,600 shares per day over the past 30 days. Outerwall has a market cap of $449.2 million and is part of the services sector and specialty retail industry. The stock has a beta of 1.56 and a short float of 54.2% with 8.29 days to cover. Shares are down 17.9% year-to-date as of the close of trading on Monday.

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TheStreet Quant Ratings

rates Outerwall as a


. The company's strengths can be seen in multiple areas, such as its increase in net income, good cash flow from operations and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and poor profit margins.

Highlights from the ratings report include:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Specialty Retail industry. The net income increased by 108.7% when compared to the same quarter one year prior, rising from $17.89 million to $37.34 million.
  • Net operating cash flow has significantly increased by 72.40% to $85.56 million when compared to the same quarter last year. In addition, OUTERWALL INC has also vastly surpassed the industry average cash flow growth rate of 19.96%.
  • OUTERWALL INC reported significant earnings per share improvement 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, OUTERWALL INC reported lower earnings of $5.71 versus $7.39 in the prior year. This year, the market expects an improvement in earnings ($7.68 versus $5.71).
  • The gross profit margin for OUTERWALL INC is currently lower than what is desirable, coming in at 33.56%. Regardless of OUTR's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 7.29% trails the industry average.
  • OUTR's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 47.51%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last 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.

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