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 Nielsen Holdings ( NLSN) 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 Nielsen Holdings as such a stock due to the following factors:
- NLSN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $69.6 million.
- NLSN has traded 1.3 million shares today.
- NLSN traded in a range 286.1% of the normal price range with a price range of $1.49.
- NLSN traded below its daily resistance level (quality: 6 days, meaning that the stock is crossing a resistance level set by the last 6 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 NLSN with the Ticky from Trade-Ideas. See the FREE profile for NLSN NOW at Trade-Ideas More details on NLSN: Nielsen Holdings N.V., an information and measurement company, provides media and marketing information, analytics, and industry expertise about what consumers buy and watch on a global and local basis. The stock currently has a dividend yield of 2.2%. NLSN has a PE ratio of 44.6. Currently there are 6 analysts that rate Nielsen Holdings a buy, 1 analyst rates it a sell, and 3 rate it a hold. The average volume for Nielsen Holdings has been 3.2 million shares per day over the past 30 days. Nielsen has a market cap of $13.8 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 0.81 and a short float of 2.8% with 3.96 days to cover. Shares are up 19.5% 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 Nielsen Holdings as a buy. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, compelling growth in net income, revenue growth, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity. Highlights from the ratings report include:
- NIELSEN HOLDINGS NV has improved earnings per share by 10.7% 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 year. We feel that this trend should continue. During the past fiscal year, NIELSEN HOLDINGS NV increased its bottom line by earning $0.71 versus $0.18 in the prior year. This year, the market expects an improvement in earnings ($1.97 versus $0.71).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Professional Services industry. The net income increased by 309.6% when compared to the same quarter one year prior, rising from $104.00 million to $426.00 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 11.9%. Since the same quarter one year prior, revenues slightly increased by 3.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Net operating cash flow has significantly increased by 77.58% to $206.00 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 43.83%.
- The gross profit margin for NIELSEN HOLDINGS NV is rather high; currently it is at 58.15%. Regardless of NLSN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, NLSN's net profit margin of 30.73% significantly outperformed against the industry.
- You can view the full Nielsen Holdings 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.