Today's Roof Leaker Stock Is Philip Morris International (PM)

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 Philip Morris International ( PM) 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 Philip Morris International as such a stock due to the following factors:

  • PM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $229.5 million.
  • PM has traded 2.2 million shares today.
  • PM is trading at 1.57 times the normal volume for the stock at this time of day.
  • PM 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.

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More details on PM:

Philip Morris International Inc., through its subsidiaries, manufactures and sells cigarettes and other tobacco products. The company's portfolio of brands include Marlboro, Merit, Parliament, Virginia Slims, L&M, Chesterfield, Bond Street, Lark, Muratti, Next, Philip Morris, and Red & White. The stock currently has a dividend yield of 4.4%. PM has a PE ratio of 16.9. Currently there are 9 analysts that rate Philip Morris International a buy, 2 analysts rate it a sell, and 3 rate it a hold.

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