Bank Of New York Mellon (BK) Is Today's Water-Logged And Getting Wetter 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 Bank of New York Mellon ( BK) 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 Bank of New York Mellon as such a stock due to the following factors:

  • BK has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $82.2 million.
  • BK has traded 1.5 million shares today.
  • BK traded in a range 4044.8% of the normal price range with a price range of $17.93.
  • BK traded below 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 '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 BK:

The Bank of New York Mellon Corporation provides various financial products and services worldwide. It operates through Investment Management, Investment Services, and Other segments. The stock currently has a dividend yield of 1.9%. BK has a PE ratio of 17.5. Currently there are 3 analysts that rate Bank of New York Mellon a buy, 2 analysts rate it a sell, and 10 rate it a hold.

The average volume for Bank of New York Mellon has been 4.4 million shares per day over the past 30 days. Bank of New York Mellon has a market cap of $36.6 billion and is part of the financial sector and financial services industry. The stock has a beta of 1.61 and a short float of 1.2% with 2.52 days to cover. Shares are up 23.7% year to date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Bank of New York Mellon as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, attractive valuation levels, expanding profit margins, solid stock price performance and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • BK's revenue growth has slightly outpaced the industry average of 8.6%. Since the same quarter one year prior, revenues slightly increased by 1.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The strong earnings growth this company has enjoyed -- up -- has apparently played a role in driving up its share price by a solid 28.69%. In addition, the rise in the general market has likely contributed to this stock's strong performance during this past year.Regarding the stock's future course, although almost any stock can fall in a broad market decline, BK should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • BANK OF NEW YORK MELLON CORP has improved earnings per share by 34.4% in the most recent quarter compared to the same quarter a year ago. Stable earnings per share over the past year indicate the company has sound management over its earnings and share float. We anticipate these figures will begin to experience more growth in the coming year. During the past fiscal year, BANK OF NEW YORK MELLON CORP increased its bottom line by earning $2.05 versus $2.04 in the prior year. This year, the market expects an improvement in earnings ($2.29 versus $2.05).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Capital Markets industry average. The net income increased by 35.2% when compared to the same quarter one year prior, rising from $725.00 million to $980.00 million.

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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