Trade-Ideas LLC identified

Cleco

(

CNL

) 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 Cleco as such a stock due to the following factors:

  • CNL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $30.4 million.
  • CNL has traded 1.0 million shares today.
  • CNL traded in a range 425.7% of the normal price range with a price range of $2.46.
  • CNL traded above its daily resistance level (quality: 4 days, meaning that the stock is crossing a resistance level set by the last 4 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.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in CNL with the Ticky from Trade-Ideas. See the FREE profile for CNL NOW at Trade-Ideas

More details on CNL:

Cleco Corporation operates as a public utility holding company primarily in Louisiana. The stock currently has a dividend yield of 3%. CNL has a PE ratio of 24. Currently there are no analysts that rate Cleco a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Cleco has been 453,700 shares per day over the past 30 days. Cleco has a market cap of $3.2 billion and is part of the utilities sector and utilities industry. The stock has a beta of 0.38 and a short float of 2.7% with 2.40 days to cover. Shares are up 0.6% year-to-date as of the close of trading on Tuesday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Cleco as a

buy

. The company's strengths can be seen in multiple areas, such as its expanding profit margins, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company has had somewhat weak growth in earnings per share.

Highlights from the ratings report include:

  • 41.25% is the gross profit margin for CLECO CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 15.82% is above that of the industry average.
  • Net operating cash flow has slightly increased to $129.54 million or 7.58% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -11.77%.
  • The debt-to-equity ratio is somewhat low, currently at 0.73, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.43 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 10.1%. Since the same quarter one year prior, revenues slightly dropped by 7.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Electric Utilities industry and the overall market on the basis of return on equity, CLECO CORP has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.