Today's Dead Cat Bounce Stock Is NCR Corporation (NCR)

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 "dead cat bounce" (down big yesterday but up big today) 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 $101.9 million.
  • NCR has traded 3.8 million shares today.
  • NCR is up 3% today.
  • NCR was down 8.3% yesterday.

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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 12.4. 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 $5.8 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 3.22 days to cover. Shares are down 5.8% 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 NCR Corporation as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth, attractive valuation levels, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • Compared to its closing price of one year ago, NCR's share price has jumped by 25.73%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, NCR should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 4.7%. Since the same quarter one year prior, revenues slightly increased by 1.7%. 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.
  • Net operating cash flow has significantly increased by 271.83% to $264.00 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 -4.18%.
  • 35.27% is the gross profit margin for NCR CORP which we consider to be strong. Regardless of NCR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, NCR's net profit margin of 11.85% is significantly lower than the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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