Trade-Ideas LLC identified

Everest Re Group

(

RE

) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Everest Re Group as such a stock due to the following factors:

  • RE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $65.6 million.
  • RE has traded 377,165 shares today.
  • RE traded in a range 221.9% of the normal price range with a price range of $8.91.
  • RE traded above its daily resistance level (quality: 39 days, meaning that the stock is crossing a resistance level set by the last 39 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on RE:

Everest Re Group, Ltd., through its subsidiaries, provides reinsurance and insurance products. The company operates through U.S. Reinsurance, International, Bermuda, Insurance, and Mt. Logan Re segments. The U.S. The stock currently has a dividend yield of 2.5%. RE has a PE ratio of 8. Currently there are 2 analysts that rate Everest Re Group a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for Everest Re Group has been 281,400 shares per day over the past 30 days. Everest Re Group has a market cap of $7.9 billion and is part of the financial sector and insurance industry. The stock has a beta of 0.65 and a short float of 4% with 4.53 days to cover. Shares are down 1.7% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Everest Re Group as a

buy

. 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, increase in net income, solid stock price performance and expanding profit margins. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 15.5%. Since the same quarter one year prior, revenues slightly increased by 3.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • RE's debt-to-equity ratio is very low at 0.08 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Insurance industry average. The net income increased by 5.0% when compared to the same quarter one year prior, going from $340.12 million to $357.28 million.
  • Compared to where it was trading a year ago, RE's share price has not changed very much due to (a) the relatively weak year-over-year performance of the overall market, (b) the company's stagnant earnings, and (c) other mixed results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • The gross profit margin for EVEREST RE GROUP LTD is currently lower than what is desirable, coming in at 29.73%. Regardless of RE's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, RE's net profit margin of 22.87% significantly outperformed against the industry.

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