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 Old Dominion Freight Lines ( ODFL) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Old Dominion Freight Lines as such a stock due to the following factors:

  • ODFL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $44.3 million.
  • ODFL has traded 1.1 million shares today.
  • ODFL traded in a range 201.1% of the normal price range with a price range of $2.32.
  • ODFL traded below its daily resistance level (quality: 51 days, meaning that the stock is crossing a resistance level set by the last 51 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Water-Logged and Getting Wetter' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower.

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More details on ODFL:

Old Dominion Freight Line, Inc. operates as a less-than-truckload (LTL) motor carrier in North America. It provides regional, inter-regional, and national LTL services, including ground and air expedited transportation, and consumer household pickup and delivery. ODFL has a PE ratio of 24.9. Currently there are 3 analysts that rate Old Dominion Freight Lines a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Old Dominion Freight Lines has been 598,600 shares per day over the past 30 days. Old Dominion Freight Lines has a market cap of $6.6 billion and is part of the services sector and transportation industry. The stock has a beta of 0.87 and a short float of 2.1% with 2.46 days to cover. Shares are down 2.7% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Old Dominion Freight Lines as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and good cash flow from operations. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:
  • ODFL's revenue growth has slightly outpaced the industry average of 13.9%. Since the same quarter one year prior, revenues rose by 21.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • ODFL's debt-to-equity ratio is very low at 0.10 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.50, which illustrates the ability to avoid short-term cash problems.
  • OLD DOMINION FREIGHT has improved earnings per share by 47.3% 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, OLD DOMINION FREIGHT increased its bottom line by earning $3.10 versus $2.40 in the prior year. This year, the market expects an improvement in earnings ($3.65 versus $3.10).
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Road & Rail industry average. The net income increased by 48.2% when compared to the same quarter one year prior, rising from $47.16 million to $69.87 million.
  • Net operating cash flow has increased to $113.66 million or 16.83% when compared to the same quarter last year. In addition, OLD DOMINION FREIGHT has also modestly surpassed the industry average cash flow growth rate of 7.66%.

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