Today's Water-Logged And Getting Wetter Stock: Motorola Solutions (MSI)

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 Motorola Solutions ( MSI) 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 Motorola Solutions as such a stock due to the following factors:

  • MSI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $158.6 million.
  • MSI has traded 1.3 million shares today.
  • MSI traded in a range 212.3% of the normal price range with a price range of $2.57.
  • MSI traded below its daily resistance level (quality: 5 days, meaning that the stock is crossing a resistance level set by the last 5 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 MSI with the Ticky from Trade-Ideas. See the FREE profile for MSI NOW at Trade-Ideas

More details on MSI:

Motorola Solutions, Inc. designs, manufactures, and sells communications infrastructure, devices, system software, and applications. The company operates in two segments, Government and Enterprise. The stock currently has a dividend yield of 2.1%. MSI has a PE ratio of 19.5. Currently there are 2 analysts that rate Motorola Solutions a buy, 2 analysts rate it a sell, and 6 rate it a hold.

The average volume for Motorola Solutions has been 2.2 million shares per day over the past 30 days. Motorola has a market cap of $16.2 billion and is part of the technology sector and telecommunications industry. The stock has a beta of 0.47 and a short float of 3.7% with 3.33 days to cover. Shares are down 1.1% 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 Motorola Solutions as a buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, good cash flow from operations, expanding profit margins, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Communications Equipment industry. The net income increased by 219.4% when compared to the same quarter one year prior, rising from $258.00 million to $824.00 million.
  • Net operating cash flow has significantly increased by 110.97% to $173.00 million when compared to the same quarter last year. In addition, MOTOROLA SOLUTIONS INC has also vastly surpassed the industry average cash flow growth rate of 7.14%.
  • The gross profit margin for MOTOROLA SOLUTIONS INC is rather high; currently it is at 50.54%. Regardless of MSI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, MSI's net profit margin of 59.15% significantly outperformed against the industry.
  • MSI, with its decline in revenue, slightly underperformed the industry average of 3.0%. Since the same quarter one year prior, revenues slightly dropped by 6.9%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Despite currently having a low debt-to-equity ratio of 0.59, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.41 is sturdy.

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

null

More from Markets

Global Stocks Slide as Trump's New Trade War Salvo Ignites Fresh Concern

Global Stocks Slide as Trump's New Trade War Salvo Ignites Fresh Concern

Trump Tariff Threat, Deutsche Bank, Elon Musk and Apple - 5 Things You Must Know

Trump Tariff Threat, Deutsche Bank, Elon Musk and Apple - 5 Things You Must Know

Automakers Slump as Trump Launches National Security Probe into US Car Imports

Automakers Slump as Trump Launches National Security Probe into US Car Imports

Deutsche Bank Confirms Massive Job Cuts as New CEO Christian Sewing Plants Flag

Deutsche Bank Confirms Massive Job Cuts as New CEO Christian Sewing Plants Flag

Carnival CEO Arnold Donald: China Will Become the Largest Cruise Market

Carnival CEO Arnold Donald: China Will Become the Largest Cruise Market