Lorillard (LO) Leads The Pack In Pre-Market 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.

Trade-Ideas LLC identified Lorillard ( LO) as a pre-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Lorillard as such a stock due to the following factors:

  • LO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $350.5 million.
  • LO traded 106,200 shares today in the pre-market hours as of 8:05 AM.
  • LO is up 3.1% today from yesterday's close.

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More details on LO:

Lorillard, Inc., through its subsidiaries, manufactures and sells cigarettes in the United States. It operates through two segments, Cigarettes and Electronic Cigarettes. The stock currently has a dividend yield of 4%. LO has a PE ratio of 20.2. Currently there is 1 analyst that rates Lorillard a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for Lorillard has been 2.8 million shares per day over the past 30 days. Lorillard has a market cap of $23.9 billion and is part of the consumer goods sector and tobacco industry. The stock has a beta of 0.47 and a short float of 1.5% with 0.99 days to cover. Shares are up 3.8% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Lorillard 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, solid stock price performance and growth in earnings per share. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 23.1%. Since the same quarter one year prior, revenues slightly increased by 2.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The gross profit margin for LORILLARD INC is rather high; currently it is at 57.83%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 25.48% is above that of the industry average.
  • Net operating cash flow has increased to $619.00 million or 35.44% when compared to the same quarter last year. In addition, LORILLARD INC has also vastly surpassed the industry average cash flow growth rate of -28.20%.
  • 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.
  • LORILLARD INC has improved earnings per share by 19.7% 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, LORILLARD INC increased its bottom line by earning $3.28 versus $3.14 in the prior year. This year, the market expects an improvement in earnings ($3.70 versus $3.28).

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