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 "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 Loews as such a stock due to the following factors:
- L has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $46.0 million.
- L has traded 183,040 shares today.
- L traded in a range 391.8% of the normal price range with a price range of $1.77.
- L traded above its daily resistance level (quality: 24 days, meaning that the stock is crossing a resistance level set by the last 24 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 L:
Loews Corporation operates primarily as a commercial property and casualty insurance company. The stock currently has a dividend yield of 0.6%. L has a PE ratio of 27.4. Currently there is 1 analyst that rates Loews a buy, no analysts rate it a sell, and 2 rate it a hold.
The average volume for Loews has been 1.1 million shares per day over the past 30 days. Loews has a market cap of $16.5 billion and is part of the financial sector and insurance industry. The stock has a beta of 1.01 and a short float of 0.6% with 1.70 days to cover. Shares are down 11% year-to-date as of the close of trading on Thursday.
rates Loews as a
. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Highlights from the ratings report include:
- Despite its growing revenue, the company underperformed as compared with the industry average of 8.1%. Since the same quarter one year prior, revenues slightly increased by 1.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- LOEWS CORP has improved earnings per share by 5.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, LOEWS CORP increased its bottom line by earning $1.51 versus $1.43 in the prior year. This year, the market expects an improvement in earnings ($3.01 versus $1.51).
- Despite currently having a low debt-to-equity ratio of 0.57, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further.
- 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 Insurance industry and the overall market on the basis of return on equity, LOEWS CORP underperformed against that of the industry average and is significantly less than that of the S&P 500.
- The gross profit margin for LOEWS CORP is rather low; currently it is at 18.46%. Regardless of L'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 1.57% trails the industry average.
- You can view the full Loews Ratings Report.