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 Chart Industries ( GTLS) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Chart Industries as such a stock due to the following factors:

  • GTLS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $20.9 million.
  • GTLS has traded 160,530 shares today.
  • GTLS is down 3.2% today.
  • GTLS was up 7.5% yesterday.

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More details on GTLS:

Chart Industries, Inc. manufactures and sells engineered equipment for the production, storage, and end-use of hydrocarbon and industrial gases worldwide. The company operates in three segments: Energy & Chemicals (E&C), Distribution & Storage (D&S), and BioMedical. GTLS has a PE ratio of 12.8. Currently there are 7 analysts that rate Chart Industries a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Chart Industries has been 716,000 shares per day over the past 30 days. Chart has a market cap of $962.6 million and is part of the industrial goods sector and industrial industry. The stock has a beta of 1.70 and a short float of 7.2% with 3.43 days to cover. Shares are down 66.6% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Chart Industries as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:
  • 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. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.35, which illustrates the ability to avoid short-term cash problems.
  • CHART INDUSTRIES INC reported flat earnings per share in the most recent quarter. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, CHART INDUSTRIES INC increased its bottom line by earning $2.60 versus $2.36 in the prior year. For the next year, the market is expecting a contraction of 4.6% in earnings ($2.48 versus $2.60).
  • GTLS's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 60.66%, which is also worse than the performance of the S&P 500 Index. Although its share price is down sharply from a year ago, do not assume that it can now be tagged as cheap and attractive. The reality is that, based on its current price in relation to its earnings, GTLS is still more expensive than most of the other companies in its industry.
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Machinery industry average. The net income has decreased by 6.5% when compared to the same quarter one year ago, dropping from $24.45 million to $22.85 million.

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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