Trade-Ideas LLC identified

PNM Resources

(

PNM

) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified PNM Resources as such a stock due to the following factors:

  • PNM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $15.2 million.
  • PNM has traded 10.2537000000000002586375558166764676570892333984375 options contracts today.
  • PNM is making at least a new 3-day high.
  • PNM has a PE ratio of 216.
  • PNM is mentioned 1.13 times per day on StockTwits.
  • PNM has not yet been mentioned on StockTwits today.
  • PNM is currently in the upper 20% of its 1-year range.
  • PNM is in the upper 35% of its 20-day range.
  • PNM is in the upper 45% of its 5-day range.
  • PNM is currently trading above yesterday's high.

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

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More details on PNM:

PNM Resources, Inc., together with its subsidiaries, operates in the energy and energy-related businesses in the United States. The company is primarily involved in the generation, transmission, and distribution of electricity. The stock currently has a dividend yield of 2.7%. PNM has a PE ratio of 216. Currently there are 4 analysts that rate PNM Resources a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for PNM Resources has been 537,000 shares per day over the past 30 days. PNM has a market cap of $2.6 billion and is part of the utilities sector and utilities industry. The stock has a beta of 0.36 and a short float of 3.5% with 6.30 days to cover. Shares are up 6.1% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates PNM Resources as a

buy

. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and solid stock price performance. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • Net operating cash flow has increased to $90.60 million or 35.75% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 8.76%.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 8.1%. Since the same quarter one year prior, revenues slightly dropped by 6.6%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • PNM RESOURCES INC's earnings per share declined by 27.8% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, PNM RESOURCES INC reported lower earnings of $0.19 versus $1.45 in the prior year. This year, the market expects an improvement in earnings ($1.62 versus $0.19).
  • 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, despite the company's weak earnings results. Looking ahead, the stock's 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 the other strengths this company displays justify these higher price levels.
  • The gross profit margin for PNM RESOURCES INC is currently lower than what is desirable, coming in at 29.37%. Regardless of PNM'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 3.43% trails the industry average.

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