Trade-Ideas LLC identified

State Street

(

STT

) 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 State Street as such a stock due to the following factors:

  • STT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $145.6 million.
  • STT has traded 273,294 shares today.
  • STT traded in a range 268.6% of the normal price range with a price range of $2.68.
  • STT traded above its daily resistance level (quality: 55 days, meaning that the stock is crossing a resistance level set by the last 55 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 STT:

State Street Corporation, through its subsidiaries, provides a range of financial products and services to institutional investors worldwide. The stock currently has a dividend yield of 2.3%. STT has a PE ratio of 13. Currently there are 5 analysts that rate State Street a buy, 3 analysts rate it a sell, and 6 rate it a hold.

The average volume for State Street has been 2.8 million shares per day over the past 30 days. State Street has a market cap of $23.1 billion and is part of the financial sector and financial services industry. The stock has a beta of 1.12 and a short float of 1.7% with 2.10 days to cover. Shares are down 12.9% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates State Street as a

hold

. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • Net operating cash flow has significantly increased by 618.38% to $2,852.00 million when compared to the same quarter last year. In addition, STATE STREET CORP has also vastly surpassed the industry average cash flow growth rate of 100.83%.
  • The gross profit margin for STATE STREET CORP is currently very high, coming in at 95.35%. Regardless of STT's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 14.14% trails the industry average.
  • Looking at the price performance of STT's shares over the past 12 months, there is not much good news to report: the stock is down 28.34%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier 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.
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Capital Markets industry average. The net income has decreased by 9.1% when compared to the same quarter one year ago, dropping from $405.00 million to $368.00 million.

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