Trade-Ideas LLC identified

Masco

(

MAS

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

  • MAS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $92.2 million.
  • MAS has traded 2.9 million shares today.
  • MAS traded in a range 214% of the normal price range with a price range of $1.16.
  • MAS traded above its daily resistance level (quality: 32 days, meaning that the stock is crossing a resistance level set by the last 32 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 MAS:

Masco Corporation designs, manufactures, markets, and distributes home improvement and building products in North America and internationally. The stock currently has a dividend yield of 1.2%. MAS has a PE ratio of 27. Currently there are 9 analysts that rate Masco a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Masco has been 3.5 million shares per day over the past 30 days. Masco has a market cap of $10.6 billion and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 1.45 and a short float of 2.9% with 3.41 days to cover. Shares are up 10.8% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Masco as a

buy

. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, expanding profit margins, solid stock price performance and growth in earnings per share. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:

  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Building Products industry average. The net income increased by 70.3% when compared to the same quarter one year prior, rising from $64.00 million to $109.00 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 10.0%. Since the same quarter one year prior, revenues slightly increased by 3.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • 35.00% is the gross profit margin for MASCO 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 6.33% is above that of the industry average.
  • Powered by its strong earnings growth of 88.23% and other important driving factors, this stock has surged by 27.75% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, MAS should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • MASCO CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, MASCO CORP reported lower earnings of $1.02 versus $2.28 in the prior year. This year, the market expects an improvement in earnings ($1.51 versus $1.02).

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