Trade-Ideas: Directv (DTV) Is Today's Unusual Social Activity Stock

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 Directv ( DTV) as an unusual social activity candidate. In addition to specific proprietary factors, Trade-Ideas identified Directv as such a stock due to the following factors:

  • DTV has 11x the normal benchmarked social activity for this time of the day compared to its average of 1.69 mentions/day.
  • DTV has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $191.3 million.

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press? Bad press? It ultimately doesn't matter if it's good or bad if you know how to trade around the sentiment. Certain hedge funds use such data for their proprietary algorithms and it is not uncommon to see shared social sentiment play itself out in a stock's price trend.

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More details on DTV:

DIRECTV provides digital television entertainment in the United States and Latin America. The company engages in acquiring, promoting, selling, and distributing digital entertainment programming primarily through satellite to residential and commercial subscribers. DTV has a PE ratio of 12.7. Currently there are 13 analysts that rate Directv a buy, 1 analyst rates it a sell, and 7 rate it a hold.

The average volume for Directv has been 3.7 million shares per day over the past 30 days. Directv has a market cap of $33.3 billion and is part of the services sector and media industry. The stock has a beta of 1.03 and a short float of 2.2% with 4.06 days to cover. Shares are up 20.9% year to date as of the close of trading on Friday.

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 Directv as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, growth in earnings per share, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • DTV's revenue growth has slightly outpaced the industry average of 0.6%. Since the same quarter one year prior, revenues slightly increased by 6.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. 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.
  • DIRECTV has improved earnings per share by 8.3% 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, DIRECTV increased its bottom line by earning $4.61 versus $3.48 in the prior year. This year, the market expects an improvement in earnings ($4.68 versus $4.61).
  • Net operating cash flow has increased to $1,474.00 million or 16.89% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -15.28%.
  • 49.01% is the gross profit margin for DIRECTV which we consider to be strong. Regardless of DTV's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 8.57% trails the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
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