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 FedEx Corporation ( FDX) 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 FedEx Corporation as such a stock due to the following factors:
- FDX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $176.2 million.
- FDX has traded 477,393 shares today.
- FDX traded in a range 344.1% of the normal price range with a price range of $5.23.
- FDX traded below its daily resistance level (quality: 22 days, meaning that the stock is crossing a resistance level set by the last 22 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. EXCLUSIVE OFFER: Get the inside scoop on opportunities in FDX with the Ticky from Trade-Ideas. See the FREE profile for FDX NOW at Trade-Ideas More details on FDX: FedEx Corporation provides transportation, e-commerce, and business services in the United States and internationally. It operates in four segments: FedEx Express, FedEx Ground, FedEx Freight, and FedEx Services. The stock currently has a dividend yield of 0.6%. FDX has a PE ratio of 22.0. Currently there are 14 analysts that rate FedEx Corporation a buy, 1 analyst rates it a sell, and 5 rate it a hold. The average volume for FedEx Corporation has been 2.6 million shares per day over the past 30 days. FedEx has a market cap of $34.2 billion and is part of the services sector and transportation industry. The stock has a beta of 1.09 and a short float of 1.7% with 3.16 days to cover. Shares are up 17.8% year to date as of the close of trading on Thursday. 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 FedEx Corporation as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income. Highlights from the ratings report include:
- FDX's revenue growth has slightly outpaced the industry average of 3.2%. Since the same quarter one year prior, revenues slightly increased by 3.9%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- FDX's debt-to-equity ratio is very low at 0.17 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, FDX has a quick ratio of 1.73, which demonstrates the ability of the company to cover short-term liquidity needs.
- 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.
- FEDEX CORP's earnings per share declined by 45.1% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, FEDEX CORP reported lower earnings of $4.92 versus $6.41 in the prior year. This year, the market expects an improvement in earnings ($6.95 versus $4.92).
- You can view the full FedEx 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.