Trade-Ideas LLC identified

CF Industries Holdings

(

CF

) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified CF Industries Holdings as such a stock due to the following factors:

  • CF has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $151.3 million.
  • CF has traded 118,808 shares today.
  • CF is up 3.3% today.
  • CF was down 7.5% yesterday.

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More details on CF:

CF Industries Holdings, Inc. manufactures and distributes nitrogen fertilizers and other nitrogen products worldwide. The company operates through Ammonia, Granular Urea, UAN, AN, Other, and Phosphate segments. The stock currently has a dividend yield of 4.2%. CF has a PE ratio of 6. Currently there are 5 analysts that rate CF Industries Holdings a buy, 1 analyst rates it a sell, and 6 rate it a hold.

The average volume for CF Industries Holdings has been 4.0 million shares per day over the past 30 days. CF has a market cap of $6.7 billion and is part of the basic materials sector and chemicals industry. The stock has a beta of 1.04 and a short float of 10.5% with 4.77 days to cover. Shares are down 26.9% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates CF Industries Holdings as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and weak operating cash flow.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 7.4%. Since the same quarter one year prior, revenues slightly increased by 5.3%. 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.
  • 36.16% is the gross profit margin for CF INDUSTRIES HOLDINGS INC which we consider to be strong. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 2.58% trails the industry average.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Chemicals industry. The net income has significantly decreased by 88.7% when compared to the same quarter one year ago, falling from $230.60 million to $26.00 million.
  • Net operating cash flow has decreased to $346.00 million or 34.82% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

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