Trade-Ideas LLC identified

T. Rowe Price Group

(

TROW

) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified T. Rowe Price Group as such a stock due to the following factors:

  • TROW has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $142.5 million.
  • TROW has traded 1.4 million shares today.
  • TROW traded in a range 217.9% of the normal price range with a price range of $2.76.
  • TROW traded below 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 'Water-Logged and Getting Wetter' 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 negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower.

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More details on TROW:

T. Rowe Price Group, Inc. is a publicly owned asset management holding company. The firm provides its services to individuals, institutional investors, retirement plans, financial intermediaries, and institutions. The stock currently has a dividend yield of 3%. TROW has a PE ratio of 16. Currently there are 8 analysts that rate T. Rowe Price Group a buy, 1 analyst rates it a sell, and 7 rate it a hold.

The average volume for T. Rowe Price Group has been 1.6 million shares per day over the past 30 days. T. Rowe Price Group has a market cap of $17.7 billion and is part of the financial sector and financial services industry. The stock has a beta of 1.32 and a short float of 4.5% with 5.47 days to cover. Shares are down 19.5% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates T. Rowe Price Group as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, growth in earnings per share, increase in net income and good cash flow from operations. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:

  • TROW's revenue growth has slightly outpaced the industry average of 6.7%. Since the same quarter one year prior, revenues slightly increased by 8.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • 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 Capital Markets industry and the overall market, PRICE (T. ROWE) GROUP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • PRICE (T. ROWE) GROUP has improved earnings per share by 9.7% 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 two years. We feel that this trend should continue. During the past fiscal year, PRICE (T. ROWE) GROUP increased its bottom line by earning $4.55 versus $3.89 in the prior year. This year, the market expects an improvement in earnings ($4.79 versus $4.55).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 9.0% when compared to the same quarter one year prior, going from $305.80 million to $333.20 million.
  • Net operating cash flow has increased to $342.90 million or 43.77% when compared to the same quarter last year. In addition, PRICE (T. ROWE) GROUP has also vastly surpassed the industry average cash flow growth rate of -422.77%.

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