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 Rexnord ( RXN) as a pre-market mover with heavy volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Rexnord as such a stock due to the following factors:
- RXN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $11.2 million.
- RXN traded 221,130 shares today in the pre-market hours as of 8:41 AM, representing 51.2% of its average daily volume.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in RXN with the Ticky from Trade-Ideas. See the FREE profile for RXN NOW at Trade-Ideas More details on RXN: Rexnord Corporation designs, manufactures, markets, and services process and motion control, and water management products worldwide. The company operates through two segments, Process & Motion Control Platform and Water Management Platform. RXN has a PE ratio of 210.9. Currently there are 2 analysts that rate Rexnord a buy, no analysts rate it a sell, and 4 rate it a hold. The average volume for Rexnord has been 201,000 shares per day over the past 30 days. Rexnord has a market cap of $2.7 billion and is part of the industrial goods sector and industrial industry. Shares are down 2% year-to-date as of the close of trading on Wednesday. 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 Rexnord as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow and generally high debt management risk. Highlights from the ratings report include:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Machinery industry. The net income has significantly decreased by 372.4% when compared to the same quarter one year ago, falling from $19.20 million to -$52.30 million.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Machinery industry and the overall market, REXNORD CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has decreased to $36.40 million or 21.55% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- The debt-to-equity ratio is very high at 4.91 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, RXN's quick ratio is somewhat strong at 1.38, demonstrating the ability to handle short-term liquidity needs.
- 39.96% is the gross profit margin for REXNORD CORP which we consider to be strong. Regardless of RXN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, RXN's net profit margin of -10.16% significantly underperformed when compared to the industry average.
- You can view the full Rexnord 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.