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 Sysco Corporation ( SYY) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Sysco Corporation as such a stock due to the following factors:
- SYY has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $360.2 million.
- SYY has traded 71.7 million shares today.
- SYY is down 3.5% today.
- SYY was up 9.6% yesterday.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in SYY with the Ticky from Trade-Ideas. See the FREE profile for SYY NOW at Trade-Ideas More details on SYY: Sysco Corporation, through its subsidiaries, markets and distributes a range of food and related products primarily to the foodservice or food-away-from-home industry. The stock currently has a dividend yield of 3.5%. SYY has a PE ratio of 20.2. Currently there is 1 analyst that rates Sysco Corporation a buy, 2 analysts rate it a sell, and 8 rate it a hold. The average volume for Sysco Corporation has been 3.7 million shares per day over the past 30 days. Sysco has a market cap of $19.5 billion and is part of the services sector and wholesale industry. The stock has a beta of 0.68 and a short float of 7.7% with 4.55 days to cover. Shares are up 8.4% 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 Sysco 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, increase in stock price during the past year, reasonable valuation levels and notable return on equity. We feel these strengths outweigh the fact that the company shows low profit margins. Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 5.7%. Since the same quarter one year prior, revenues slightly increased by 5.7%. 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.
- The debt-to-equity ratio is somewhat low, currently at 0.60, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.97 is somewhat weak and could be cause for future problems.
- Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. 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.
- SYSCO CORP' earnings per share from the most recent quarter came in slightly below the year earlier quarter. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, SYSCO CORP reported lower earnings of $1.68 versus $1.91 in the prior year. This year, the market expects an improvement in earnings ($1.86 versus $1.68).
- You can view the full Sysco 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.