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.

Trade-Ideas LLC identified Nielsen ( NLSN) as a "storm the castle" (crossing above the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified Nielsen as such a stock due to the following factors:

  • NLSN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $103.6 million.
  • NLSN has traded 2.4 million shares today.
  • NLSN is trading at 1.66 times the normal volume for the stock at this time of day.
  • NLSN crossed above its 200-day simple moving average.

'Storm the Castle' stocks are worth watching because trading stocks that begin to experience a breakout can lead to potentially massive profits. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock is then free to find new buyers and momentum traders who can ultimately push the stock significantly higher. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize on. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on NLSN:

Nielsen N.V. operates as an information and measurement company. The company provides media and marketing information, analytics, and manufacturer and retailer expertise about what and where consumers buy, read, watch and listen. The stock currently has a dividend yield of 2.3%. NLSN has a PE ratio of 43.0. Currently there are 12 analysts that rate Nielsen a buy, 1 analyst rates it a sell, and 1 rates it a hold.

The average volume for Nielsen has been 2.6 million shares per day over the past 30 days. Nielsen has a market cap of $16.0 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 0.95 and a short float of 3.1% with 4.43 days to cover. Shares are down 3.1% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Nielsen as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations, growth in earnings per share and increase in net income. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • NLSN's revenue growth has slightly outpaced the industry average of 6.1%. Since the same quarter one year prior, revenues slightly increased by 1.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The gross profit margin for NIELSEN HOLDINGS NV is rather high; currently it is at 60.01%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 9.85% is above that of the industry average.
  • Net operating cash flow has increased to $401.00 million or 25.31% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 7.48%.
  • NIELSEN HOLDINGS NV's earnings per share improvement from the most recent quarter was slightly positive. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, NIELSEN HOLDINGS NV reported lower earnings of $1.00 versus $1.13 in the prior year. This year, the market expects an improvement in earnings ($2.71 versus $1.00).
  • The company, on the basis of net income growth from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Professional Services industry average. The net income increased by 11.0% when compared to the same quarter one year prior, going from $145.00 million to $161.00 million.

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