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 Francescas Holdings ( FRAN) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Francescas Holdings as such a stock due to the following factors:
- FRAN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $25.5 million.
- FRAN has traded 451,217 shares today.
- FRAN is up 3.3% today.
- FRAN was down 11.3% yesterday.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in FRAN with the Ticky from Trade-Ideas. See the FREE profile for FRAN NOW at Trade-Ideas More details on FRAN: Francesca's Holdings Corporation, through its subsidiary, Francesca's Collections, Inc., operates a chain of retail boutiques. The company offers a selection of fashion apparel, jewelry, accessories, and gifts primarily for women between the ages of 18 and 35. FRAN has a PE ratio of 15.0. Currently there are 8 analysts that rate Francescas Holdings a buy, no analysts rate it a sell, and 5 rate it a hold. The average volume for Francescas Holdings has been 1.1 million shares per day over the past 30 days. Francescas has a market cap of $645.0 million and is part of the services sector and retail industry. The stock has a beta of 1.95 and a short float of 25.9% with 4.35 days to cover. Shares are down 26.4% year-to-date as of the close of trading on Tuesday. 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 Francescas Holdings as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and a generally disappointing performance in the stock itself. Highlights from the ratings report include:
- FRAN's revenue growth has slightly outpaced the industry average of 2.0%. Since the same quarter one year prior, revenues slightly increased by 6.3%. 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.
- The current debt-to-equity ratio, 0.32, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, FRAN has a quick ratio of 2.32, which demonstrates the ability of the company to cover short-term liquidity needs.
- The gross profit margin for FRANCESCAS HOLDINGS CORP is rather high; currently it is at 53.41%. Regardless of FRAN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, FRAN's net profit margin of 11.51% compares favorably to the industry average.
- Looking at the price performance of FRAN's shares over the past 12 months, there is not much good news to report: the stock is down 50.02%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
- 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 Specialty Retail industry. The net income has significantly decreased by 28.6% when compared to the same quarter one year ago, falling from $14.87 million to $10.61 million.
- You can view the full Francescas Holdings 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.