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 Citrix Systems ( CTXS) 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 Citrix Systems as such a stock due to the following factors:
- CTXS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $139.7 million.
- CTXS has traded 1.1 million shares today.
- CTXS traded in a range 200.6% of the normal price range with a price range of $2.67.
- CTXS 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 CTXS with the Ticky from Trade-Ideas. See the FREE profile for CTXS NOW at Trade-Ideas More details on CTXS: Citrix Systems, Inc. provides cloud computing solutions that enable information technology (IT) and service providers to build private and public clouds worldwide. The company operates in two divisions, Enterprise and Online Services. CTXS has a PE ratio of 36.3. Currently there are 13 analysts that rate Citrix Systems a buy, no analysts rate it a sell, and 8 rate it a hold. The average volume for Citrix Systems has been 2.4 million shares per day over the past 30 days. Citrix Systems has a market cap of $11.2 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 2.11 and a short float of 1.7% with 0.98 days to cover. Shares are down 8.2% 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 Citrix Systems as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity. Highlights from the ratings report include:
- CTXS's revenue growth has slightly outpaced the industry average of 7.1%. Since the same quarter one year prior, revenues rose by 11.1%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
- Net operating cash flow has increased to $222.95 million or 23.18% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -4.99%.
- CTXS has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.85 is somewhat weak and could be cause for future problems.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Software industry. The net income has decreased by 1.9% when compared to the same quarter one year ago, dropping from $78.25 million to $76.73 million.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Software industry and the overall market, CITRIX SYSTEMS INC's return on equity is below that of both the industry average and the S&P 500.
- You can view the full Citrix Systems 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.