Raytheon (RTN): Stock With Unusual Social Activity

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 Raytheon ( RTN) as an unusual social activity candidate. In addition to specific proprietary factors, Trade-Ideas identified Raytheon as such a stock due to the following factors:

  • RTN has 11x the normal benchmarked social activity for this time of the day compared to its average of 2.10 mentions/day.
  • RTN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $194.7 million.

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press? Bad press? It ultimately doesn't matter if it's good or bad if you know how to trade around the sentiment. Certain hedge funds use such data for their proprietary algorithms and it is not uncommon to see shared social sentiment play itself out in a stock's price trend.

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More details on RTN:

Raytheon Company develops integrated products, services, and solutions in the areas of sensing; effects; command, control, communications, and intelligence; mission support; and cyber and information security worldwide. The stock currently has a dividend yield of 2.4%. RTN has a PE ratio of 15.6. Currently there are 8 analysts that rate Raytheon a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for Raytheon has been 1.8 million shares per day over the past 30 days. Raytheon has a market cap of $31.7 billion and is part of the industrial goods sector and aerospace/defense industry. The stock has a beta of 0.53 and a short float of 1.9% with 3.30 days to cover. Shares are up 16.9% 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 Raytheon as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and increase in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • RAYTHEON CO has improved earnings per share by 9.3% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, RAYTHEON CO increased its bottom line by earning $5.96 versus $5.66 in the prior year. This year, the market expects an improvement in earnings ($6.87 versus $5.96).
  • The current debt-to-equity ratio, 0.40, is low and is below the industry average, implying that there has been successful management of debt levels.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Aerospace & Defense industry average. The net income increased by 5.3% when compared to the same quarter one year prior, going from $489.00 million to $515.00 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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