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 Liberty Global ( LBTYA) as a "roof leaker" (crossing below the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified Liberty Global as such a stock due to the following factors:
- LBTYA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $293.9 million.
- LBTYA has traded 80,389 shares today.
- LBTYA is trading at 701.08 times the normal volume for the stock at this time of day.
- LBTYA crossed below its 200-day simple moving average.
'Roof Leaker' stocks are worth watching because trading stocks that begin to experience a breakdown can lead to potentially massive losses. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock may then be subject to emotional selling from investors that can continue to drive the stock lower. Regardless of the impetus behind the price and volume action, when a stock moves with weakness and volume it can indicate the start of a new, potentially dangerous, trend. EXCLUSIVE OFFER: Get the inside scoop on opportunities in LBTYA with the Ticky from Trade-Ideas. See the FREE profile for LBTYA NOW at Trade-Ideas More details on LBTYA: Liberty Global plc, an international cable company, provides television, broadband Internet, and telephony services. Currently there are 7 analysts that rate Liberty Global a buy, no analysts rate it a sell, and none rate it a hold. The average volume for Liberty Global has been 1.8 million shares per day over the past 30 days. Liberty Global has a market cap of $18.4 billion and is part of the services sector and media industry. The stock has a beta of 1.25 and a short float of 2.8% with 1.64 days to cover. Shares are down 9.2% 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 Liberty Global as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including deteriorating net income and generally higher debt management risk. Highlights from the ratings report include:
- LBTYA's very impressive revenue growth greatly exceeded the industry average of 2.4%. Since the same quarter one year prior, revenues leaped by 73.5%. 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.
- Net operating cash flow has significantly increased by 159.63% to $1,119.80 million when compared to the same quarter last year. In addition, LIBERTY GLOBAL PLC has also vastly surpassed the industry average cash flow growth rate of 15.30%.
- LBTYA's share price has surged by 26.18% over the past year, reflecting the market's general trend, despite their weak earnings growth during the last quarter. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- 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 Media industry. The net income has significantly decreased by 3605.8% when compared to the same quarter one year ago, falling from -$22.40 million to -$830.10 million.
- Although LBTYA's debt-to-equity ratio of 3.70 is very high, it is currently less than that of the industry average. To add to this, LBTYA has a quick ratio of 0.52, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
- You can view the full Liberty Global 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.