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 Celanese Corporation ( CE) 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 Celanese Corporation as such a stock due to the following factors:
- CE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $51.2 million.
- CE has traded 853,486 shares today.
- CE traded in a range 204.8% of the normal price range with a price range of $1.84.
- CE traded above its daily resistance level (quality: 531 days, meaning that the stock is crossing a resistance level set by the last 531 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 CE with the Ticky from Trade-Ideas. See the FREE profile for CE NOW at Trade-Ideas More details on CE: Celanese Corporation engages in manufacture and sale of value-added chemicals, thermoplastic polymers, and other chemical-based products. The company operates in four segments: Advanced Engineered Materials, Consumer Specialties, Industrial Specialties, and Acetyl Intermediates. The stock currently has a dividend yield of 1.5%. CE has a PE ratio of 16.9. Currently there are 8 analysts that rate Celanese Corporation a buy, 1 analyst rates it a sell, and 6 rate it a hold. The average volume for Celanese Corporation has been 980,100 shares per day over the past 30 days. Celanese has a market cap of $7.9 billion and is part of the basic materials sector and chemicals industry. The stock has a beta of 2.06 and a short float of 1.5% with 1.90 days to cover. Shares are up 9.9% year to date as of the close of trading on Tuesday. STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more. TheStreetRatings.com Analysis: TheStreet Quant Ratings rates Celanese Corporation as a buy. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, solid stock price performance and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income. Highlights from the ratings report include:
- Net operating cash flow has increased to $229.00 million or 22.45% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -10.41%.
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- CELANESE CORP's earnings per share declined by 39.9% 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, CELANESE CORP increased its bottom line by earning $3.93 versus $3.82 in the prior year. This year, the market expects an improvement in earnings ($4.48 versus $3.93).
- CE, with its decline in revenue, slightly underperformed the industry average of 2.6%. Since the same quarter one year prior, revenues slightly dropped by 1.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. When compared to other companies in the Chemicals industry and the overall market, CELANESE CORP's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
- You can view the full Celanese Corporation Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.