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 Chemtura Corporation ( CHMT) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Chemtura Corporation as such a stock due to the following factors:
- CHMT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $33.6 million.
- CHMT has traded 66,040 shares today.
- CHMT is up 3.2% today.
- CHMT was down 8.1% yesterday.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in CHMT with the Ticky from Trade-Ideas. See the FREE profile for CHMT NOW at Trade-Ideas More details on CHMT: Chemtura Corporation, together with its subsidiaries, develops, manufactures, and markets performance-driven engineered specialty chemicals primarily for industrial manufacturing customers. Currently there are 4 analysts that rate Chemtura Corporation a buy, 1 analyst rates it a sell, and none rate it a hold. The average volume for Chemtura Corporation has been 1.1 million shares per day over the past 30 days. Chemtura has a market cap of $2.2 billion and is part of the basic materials sector and chemicals industry. The stock has a beta of 2.40 and a short float of 6.3% with 3.74 days to cover. Shares are down 17.1% 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 Chemtura Corporation 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, poor profit margins and feeble growth in its earnings per share. 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 Chemicals industry. The net income has significantly decreased by 205.0% when compared to the same quarter one year ago, falling from $20.00 million to -$21.00 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 Chemicals industry and the overall market, CHEMTURA CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has significantly decreased to $20.00 million or 81.30% 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 gross profit margin for CHEMTURA CORP is rather low; currently it is at 24.45%. Regardless of CHMT's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, CHMT's net profit margin of -3.86% significantly underperformed when compared to the industry average.
- CHEMTURA CORP's earnings per share declined by 31.6% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, CHEMTURA CORP swung to a loss, reporting -$0.23 versus $1.03 in the prior year. This year, the market expects an improvement in earnings ($1.25 versus -$0.23).
- You can view the full Chemtura 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.