Barbarian At The Gate: WP Glimcher (WPG)

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 WP Glimcher ( WPG) 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 WP Glimcher as such a stock due to the following factors:

  • WPG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $26.7 million.
  • WPG has traded 1.6 million shares today.
  • WPG traded in a range 211.1% of the normal price range with a price range of $0.50.
  • WPG traded above its daily resistance level (quality: 18 days, meaning that the stock is crossing a resistance level set by the last 18 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.

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More details on WPG:

Washington Prime Group Inc. (NYSE:WPG.WI) operates independently of Simon Property Group Inc. as of May 28, 2014. The stock currently has a dividend yield of 7.5%. WPG has a PE ratio of 16. Currently there is 1 analyst that rates WP Glimcher a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for WP Glimcher has been 1.8 million shares per day over the past 30 days. WP Glimcher has a market cap of $2.5 billion and is part of the financial sector and real estate industry. Shares are down 21.6% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates WP Glimcher as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, unimpressive growth in net income, poor profit margins and weak operating cash flow.

Highlights from the ratings report include:
  • WP GLIMCHER 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. For the next year, the market is expecting a contraction of 89.1% in earnings ($0.12 versus $1.10).
  • 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 Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 121.2% when compared to the same quarter one year ago, falling from $34.39 million to -$7.29 million.
  • The gross profit margin for WP GLIMCHER INC is rather low; currently it is at 20.50%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -3.06% is significantly below that of the industry average.
  • Net operating cash flow has decreased to $51.77 million or 23.08% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 30.43%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 131.81% compared to the year-earlier quarter.

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