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 NCR Corporation ( NCR) 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 NCR Corporation as such a stock due to the following factors:
- NCR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $71.4 million.
- NCR has traded 4.3 million shares today.
- NCR traded in a range 209.8% of the normal price range with a price range of $2.10.
- NCR traded below its daily resistance level (quality: 56 days, meaning that the stock is crossing a resistance level set by the last 56 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 NCR with the Ticky from Trade-Ideas. See the FREE profile for NCR NOW at Trade-Ideas More details on NCR: NCR Corporation provides technology and services that enable businesses connect, interact, and transact with their customers worldwide. The company operates in four segments: Financial Services, Retail Solutions, Hospitality, and Emerging Industries. NCR has a PE ratio of 39.0. Currently there are 2 analysts that rate NCR Corporation a buy, no analysts rate it a sell, and 4 rate it a hold. The average volume for NCR Corporation has been 2.3 million shares per day over the past 30 days. NCR has a market cap of $5.7 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.21 and a short float of 6.1% with 4.45 days to cover. Shares are up 2.7% year-to-date as of the close of trading on Thursday. 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 NCR Corporation as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations, growth in earnings per share, increase in net income and solid stock price performance. We feel these strengths outweigh the fact that the company shows low profit margins. Highlights from the ratings report include:
- NCR's revenue growth has slightly outpaced the industry average of 4.6%. Since the same quarter one year prior, revenues slightly increased by 5.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- NCR CORP has improved earnings per share by 9.4% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, NCR CORP increased its bottom line by earning $1.29 versus $0.91 in the prior year. This year, the market expects an improvement in earnings ($2.78 versus $1.29).
- Net operating cash flow has significantly increased by 100.00% to $0.00 million when compared to the same quarter last year. In addition, NCR CORP has also vastly surpassed the industry average cash flow growth rate of -4.27%.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 31.04% over the past year, a rise that has exceeded that of the S&P 500 Index. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- The net income growth from the same quarter one year ago has exceeded that of the Computers & Peripherals industry average, but is less than that of the S&P 500. The net income increased by 12.6% when compared to the same quarter one year prior, going from $87.00 million to $98.00 million.
- You can view the full NCR 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.