Ann (ANN) Is Today's Unusual Social Activity Stock

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 Ann ( ANN) as an unusual social activity candidate. In addition to specific proprietary factors, Trade-Ideas identified Ann as such a stock due to the following factors:

  • ANN has more that 20x the normal benchmarked social activity for this time of the day compared to its average of 4.61 mentions/day.
  • ANN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $153.2 million.

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press? Bad press? It ultimately doesn't matter if it's good or bad if you know how to trade around the sentiment. Certain hedge funds use such data for their proprietary algorithms and it is not uncommon to see shared social sentiment play itself out in a stock's price trend.

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More details on ANN:

ANN INC., through its subsidiaries, engages in the retailing of women's apparel, shoes, and accessories under the Ann Taylor and LOFT brands. ANN has a PE ratio of 27. Currently there are 6 analysts that rate Ann a buy, no analysts rate it a sell, and 9 rate it a hold.

The average volume for Ann has been 631,100 shares per day over the past 30 days. Ann has a market cap of $1.8 billion and is part of the services sector and retail industry. The stock has a beta of 0.75 and a short float of 3% with 0.39 days to cover. Shares are up 27.2% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

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

Highlights from the ratings report include:
  • Despite its growing revenue, the company underperformed as compared with the industry average of 12.1%. Since the same quarter one year prior, revenues slightly increased by 3.9%. 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 slightly increased to $121.42 million or 9.42% when compared to the same quarter last year. Despite an increase in cash flow, ANN INC's cash flow growth rate is still lower than the industry average growth rate of 19.66%.
  • The gross profit margin for ANN INC is rather high; currently it is at 50.08%. Regardless of ANN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 0.04% trails the industry average.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. In comparison to the other companies in the Specialty Retail industry and the overall market, ANN INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • The share price of ANN INC has not done very well: it is down 5.66% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.

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