Trade-Ideas: Post Holdings (POST) Is Today's

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 Post Holdings ( POST) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Post Holdings as such a stock due to the following factors:

  • POST has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $23.7 million.
  • POST has traded 62,998 shares today.
  • POST traded in a range 229.7% of the normal price range with a price range of $3.01.
  • POST traded above its daily resistance level (quality: 8 days, meaning that the stock is crossing a resistance level set by the last 8 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' 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 positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in POST with the Ticky from Trade-Ideas. See the FREE profile for POST NOW at Trade-Ideas

More details on POST:

Post Holdings, Inc. manufactures, markets, and sells refrigerated, active nutrition, and private label food products in the United States and Canada. The company operates through five segments: Post Foods, Michael Foods, Active Nutrition, Private Brands, and Attune Foods. Currently there is 1 analyst that rates Post Holdings a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Post Holdings has been 528,400 shares per day over the past 30 days. Post has a market cap of $2.4 billion and is part of the consumer goods sector and food & beverage industry. The stock has a beta of 0.47 and a short float of 22.2% with 18.20 days to cover. Shares are up 8% year-to-date as of the close of trading on Thursday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Post Holdings as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:
  • POST's very impressive revenue growth greatly exceeded the industry average of 9.5%. Since the same quarter one year prior, revenues leaped by 261.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has significantly increased by 129.71% to $57.20 million when compared to the same quarter last year. In addition, POST HOLDINGS INC has also vastly surpassed the industry average cash flow growth rate of 56.71%.
  • POST HOLDINGS INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, POST HOLDINGS INC swung to a loss, reporting -$7.60 versus $0.29 in the prior year. This year, the market expects an improvement in earnings (-$0.47 versus -$7.60).
  • The gross profit margin for POST HOLDINGS INC is currently lower than what is desirable, coming in at 26.25%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -9.06% is significantly below that of the industry average.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Food Products industry. The net income has significantly decreased by 3954.2% when compared to the same quarter one year ago, falling from -$2.40 million to -$97.30 million.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

If you liked this article you might like

8 Tasty Stocks for a Changing Food-Retail Business

8 Tasty Stocks for a Changing Food-Retail Business

Groupon, Salesforce.com, Marriott International: 'Mad Money' Lightning Round

Groupon, Salesforce.com, Marriott International: 'Mad Money' Lightning Round

Stocks That Gain From New Tax Law: Cramer's 'Mad Money' Recap (Wed 12/20/17)

Stocks That Gain From New Tax Law: Cramer's 'Mad Money' Recap (Wed 12/20/17)

Buffalo Wild Wings Sale Hints Some Other Big Restaurant Deals Are Lurking

Buffalo Wild Wings Sale Hints Some Other Big Restaurant Deals Are Lurking

There Is Certainly a Disturbance in the (Markets) Force: Market Recon

There Is Certainly a Disturbance in the (Markets) Force: Market Recon