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

  • HL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $19.1 million.
  • HL has traded 197,918 shares today.
  • HL is down 3.1% today.
  • HL was up 8.4% yesterday.

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More details on HL:

Hecla Mining Company, together with its subsidiaries, discovers, acquires, develops, produces, and markets precious and base metal deposits worldwide. The stock currently has a dividend yield of 0.3%. HL has a PE ratio of 60.0. Currently there are no analysts that rate Hecla Mining a buy, 1 analyst rates it a sell, and 7 rate it a hold.

The average volume for Hecla Mining has been 6.8 million shares per day over the past 30 days. Hecla has a market cap of $1.1 billion and is part of the basic materials sector and metals & mining industry. The stock has a beta of 0.41 and a short float of 7.2% with 4.02 days to cover. Shares are up 6.8% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Hecla Mining as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income and expanding profit margins. However, as a counter to these strengths, we find that the stock has experienced relatively poor performance when compared with the S&P 500 during the past year.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 18.7%. Since the same quarter one year prior, revenues slightly increased by 6.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • 43.51% is the gross profit margin for HECLA MINING CO which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 13.85% is above that of the industry average.
  • Despite currently having a low debt-to-equity ratio of 0.37, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 2.69 is very high and demonstrates very strong liquidity.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, HECLA MINING CO underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • In its most recent trading session, HL has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. We feel that the combination of its price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.

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